How to Export to Pakistan in 2026: Duty Slabs, 18% Sales Tax, PSW and PSQCA

Customs value, duty slabs, ACD and regulatory duty

Goods are classified by Pakistan Customs Tariff (PCT) code. Under section 25 of the Customs Act, 1969, the customs value is the transaction value, which is the price actually paid or payable for the goods. It is increased by the cost of transport (but not inland freight after importation), loading, unloading and handling charges, and insurance up to the port, airport or place of importation, so in practice it is a CIF value. For some goods, the Directorate General of Customs Valuation issues valuation rulings under section 25A, and the value in the ruling is then used for assessment. An importer who disagrees can file a revision petition within 30 days under section 25D.

Customs duty (CD) is a percentage of the customs value. The tariff uses slabs of 0%, 5%, 10%, 15% and 20%, with slabs of 25% and higher for some goods. Under the National Tariff Policy 2025-30, the Budget 2026-27 cut CD on 92 tariff lines of industrial inputs: from 20% to 15% or 10%, from 15% and 10% to 10% and 5%, and from 5% to 0%. Additional customs duty (ACD) is set by S.R.O. 1063(I)/2026 of 30 June 2026, in force from 1 July 2026, and is charged on the same section 25 value. It is 2% for goods in the 20% slab, except listed lines charged at 4%, and a separate rate applies to the 25% and higher slabs. The Budget 2026-27 cut ACD from 6% to 4% on 449 tariff lines and from 4% to 2% on 2,107 lines, and removed the 2% ACD on 569 lines. Plant and machinery of Chapters 84 and 85 imported for manufacturing is among the listed exemptions.

Regulatory duty (RD) applies only to specific tariff lines. The Budget 2026-27 capped RD at 20% on 359 lines that were above 20%, applied a 20% reduction to all RD rates between 2.5% and 20% on 1,347 lines, and cut or removed RD rates of 2.5%, 2% and 1%. Rates change with every annual budget, so confirm CD, ACD and RD for your exact PCT code with the importer's customs agent before you quote a delivered price.

Sales tax and withholding income tax at import

Section 3 of the Sales Tax Act, 1990 charges sales tax at 18% on goods imported into Pakistan (text as amended up to 30 June 2025). For imports, the taxable value is the customs value under section 25 plus the customs duties and federal excise duty charged on the goods. Goods listed in the Third Schedule of the Act are taxed at 18% of the retail price instead, and the importer must print or emboss the retail price and the amount of sales tax on each article, packet or label. Section 7A also allows a minimum value addition tax on goods listed in the Twelfth Schedule of the same Act; ask the importer's agent whether it applies.

Customs also collects advance income tax from the importer under section 148 of the Income Tax Ordinance, 2001. The FBR withholding tax rate card, updated up to 30 June 2026 as per the Finance Act, 2026, lists 1% for goods in Part I of the income tax Twelfth Schedule, 2% for Part II (3.5% for commercial importers) and 5.5% for Part III (6% for commercial importers). These rates are for persons on the Active Taxpayers List (ATL); for other importers the rate is doubled.

Example for a product in the 20% slab with the standard 2% ACD, no RD and no federal excise duty: customs value USD 10,000, CD USD 2,000, ACD USD 200, sales tax 18% of USD 12,200 = USD 2,196, so USD 4,396 in duty and sales tax, before withholding income tax.

Registration and clearance: NTN, PSW and WeBOC

Registration is done by the Pakistani importer. First it subscribes to the Pakistan Single Window (PSW), the national trade portal. PSW asks for a tax number (NTN, FTN or STRN), an SECP registration number for companies, and biometric verification of the subscriber at a NADRA e-Sahulat centre. The fee is PKR 500, paid once, and the user ID stays valid for two years. The importer then registers with Customs as a trader through the PSW portal, and its bank sends a banking profile with the permitted payment modes to PSW.

The importer or its customs agent files the import declaration. Where a regulatory requirement applies, such as a licence, permit or certificate from another agency (LPCO), filing a Single Declaration (SD) through PSW is mandatory, and LPCOs are applied for in PSW. WeBOC (Web-Based One Customs) remains the core customs management system used for customs processing.

Payment through banks: L/C, contract, advance and open account

The Import Policy Order 2022 (S.R.O. 545(I)/2022 of 22 April 2022) allows imports against all modes of payment, subject to State Bank of Pakistan (SBP) procedures. The importer pays through its bank, an authorised dealer in foreign exchange. The PSW user manual of November 2022 lists four payment modes: letter of credit (L/C), contract/collection, advance payment and open account. The bank shares a financial instrument for the transaction with PSW, and only one financial instrument can be linked to a declaration. The same manual says the earlier step of bank approval of an electronic import form (EIF) before the customs declaration has been eliminated.

Under SBP EPD Circular Letter No. 01 of 2024 (30 January 2024), banks may make import advance payments of up to 100% of the value of an irrevocable L/C or invoice without prior SBP approval, with appropriate due diligence. The detailed rules are in paragraph 30 of Chapter 13 (Imports) of the SBP Foreign Exchange Manual, so ask the importer to confirm with its bank before you ship against an advance.

PSQCA standards, import policy and labelling

Under paragraph 6(2) of the Import Policy Order 2022, imported goods must meet the same national standards as similar goods made in Pakistan; Appendix N lists the standards notified by the Pakistan Standards and Quality Control Authority (PSQCA). Under PSW circular PSW/Dom/407 of 22 December 2023, importers of these goods must file the Single Declaration through PSW from 3 January 2024, and clearance depends on an electronic release order from PSQCA. The annexed lists give the PCT code and the Pakistan standard for each product. Appendix A of the Order lists banned goods, Appendix B restricted goods and Appendix C goods that may not be imported in used condition, with some exceptions.

• PSQCA lists include food such as edible oils, biscuits and juices; personal care such as soaps, shampoos, skin creams and hair dye; tyres, cement and steel; and electrical goods such as cables, LED lamps, switches and small appliances.
• Edible products: ingredients and product details printed in Urdu and English on the consumer pack, with the halal certification body's logo; stickers, overprinting and stamps are not accepted.
• Edible products must have at least 66% of their shelf life remaining; pharmaceutical raw materials and drugs at least 75%.
• Medicines follow the Drugs (Labeling and Packaging) Rules, 1986.
• Third Schedule goods: retail price and sales tax amount printed or embossed on each pack by the importer.

China-Pakistan FTA and other preferences

The China-Pakistan Free Trade Agreement (CPFTA) was amended by a Phase II protocol signed on 28 April 2019. Both countries liberalise 75% of tariff lines for each other, China over 10 years and Pakistan over 15 years, while 25% of Pakistan's lines (1,760 lines) stay on a protected list covering sectors such as textiles, iron and steel, autos and chemicals. The protocol added an electronic data exchange system to stop misdeclaration and under-invoicing of imports from China, so the values and descriptions on your invoice and certificate of origin must match exactly. If you export from another country, ask the importer's customs agent whether a free trade or preferential agreement covers your origin and which proof of origin it needs.