6th Schedule of Sales Tax: Exempt Goods, Tables, and Buyers

The 6th Schedule of Sales Tax under Pakistan’s Sales Tax Act, 1990, lists goods that are completely exempt from sales tax at every stage of the supply chain. Section 13(1) of the Act is the legal hook: goods specified in the schedule are exempt from the standard 18 percent rate, subject to any conditions the Federal Government sets.¹ The schedule is split into tables that separate exemptions by whether they cover imports, local supplies, or both, and Finance Acts revise those tables every year.

Table I: Goods Exempt on Import and Local Supply

Table I covers goods that carry no sales tax whether they enter Pakistan through international trade or move through the domestic supply chain. Most of the table targets essential food and agricultural inputs.

Current entries include pulses (Entry 14), edible fruits (Entry 46), live animals and poultry (Entry 1), and seeds for sowing (Entry 171). One recent change matters for anyone still working from an older version of the Act: edible vegetables, previously exempt at Entry 13, were omitted from Table I by the Finance Act, 2024.¹ Businesses still treating vegetables as exempt risk underpaying tax and triggering penalties.

Table I also covers goods imported by or donated to government-run hospitals and non-profit educational and research institutions, subject to the same restrictions that apply for zero-rate customs duty under the Customs Act, 1969.² Each entry carries an HS Code or a reference to the corresponding customs heading. The exemption only stands when both the code and the goods description match your actual product.

Table II: Goods Exempt Only on Local Supply

Table II works differently. Items listed here are exempt only when produced and sold within Pakistan. Import the same goods, and standard sales tax applies. The intent is to shield local producers from the tax while still collecting revenue at the border.

Dairy is the biggest category, but with a catch. Milk, cream, yogurt, butter, desi ghee, and cheese are exempt only when they are not sold under a brand name in retail packing.¹ A local farmer selling unbranded milk pays nothing. A national brand packaging the same milk in retail cartons pays the full rate.

Other locally supplied items exempt under Table II include:

Breads, nans, and chapattis of all types (Entry 54).
Bovine, sheep, goat, and uncooked poultry meat, excluding sales under a brand name (Entry 41).
Fish and crustaceans, again excluding branded sales (Entry 42).
Prepared food from restaurants and caterers (Entry 53).
Fruit juices that are fresh, frozen, or otherwise preserved, but not bottled, canned, or packaged (Entry 29).

The brand-name condition is where most disputes start. Manufacture dairy or meat locally, sell it under a registered brand, and you do not qualify. You must charge sales tax at the standard rate.¹

Exemptions Tied to the Buyer

Some 6th Schedule exemptions depend not on the product but on who is buying it. Government hospitals, non-profit educational institutions, and registered charities can import or procure certain goods without paying sales tax, provided they meet specific legal requirements.

To qualify, a non-profit must fit the definition in Section 2(36) of the Income Tax Ordinance, 2001. That section requires the entity to be established for religious, educational, charitable, or welfare purposes, formally registered under an applicable law, and approved by the Commissioner of Inland Revenue. Recreational clubs whose joining fee exceeds one million rupees for any membership class are explicitly excluded, even if structured as non-profits.³

Registration alone is not enough. The organization must apply to the Commissioner and receive written approval, and that approval has to stay current. An expired or revoked approval means the exemption disappears, and any purchases made during a lapsed period become taxable.

Exempt Is Not the Same as Zero-Rated

Zero-rated goods (5th Schedule) and exempt goods (6th Schedule) both mean the buyer pays no sales tax. The consequences for the seller are very different.

A zero-rated sale is still a “taxable supply” under Section 2(41) of the Act.¹ You can reclaim all the input tax paid on raw materials, utilities, and other purchases used in producing or supplying those goods. You charge zero on the sale and recover what you paid on your inputs. The net effect lowers the product’s final cost.

An exempt sale under the 6th Schedule is not a taxable supply. Section 8(1)(a) blocks you from reclaiming input tax on anything used to produce or supply exempt goods, so that tax becomes a hidden cost baked into your price. If you deal in both taxable and exempt supplies, Section 8(2) lets you reclaim only the portion of input tax attributable to taxable supplies.¹ Getting that apportionment wrong is one of the fastest routes to an audit adjustment.

Confirming an Exemption Actually Applies

Verifying that a transaction qualifies requires matching two things: the product itself and, where relevant, the buyer’s status.

For the product, look up the correct HS Code from the Pakistan Customs Tariff. Every entry in the 6th Schedule lists either a specific HS Code or a reference to customs headings.⁴ The code alone is not enough. Both the number and the written description have to match your product. A common error is finding an HS Code that fits while ignoring a qualifier in the description, such as “excluding those sold under a brand name” or “excluding those bottled or canned.”

For conditional exemptions tied to buyer identity, confirm the purchaser’s registration and approval status. Non-profits must hold current Commissioner approval under Section 2(36) of the Income Tax Ordinance.³ The FBR’s IRIS portal shows whether a buyer sits on the Active Taxpayer List, but for institutional exemptions the seller should also request a copy of the approval letter before treating the sale as exempt.

How the Schedule Changes From Year to Year

The 6th Schedule is not fixed. The Federal Government updates it through annual Finance Acts and, in limited cases, through Gazette notifications. Section 13(2) restricts mid-year notifications to situations involving national security, natural disasters, food security emergencies, or the implementation of bilateral and multilateral agreements. Any notification issued after 1 July 2015 automatically expires at the end of the financial year unless Parliament renews it.¹

Recent examples show how fast things move. The Finance Act, 2024, omitted several long-standing entries from both tables, including edible vegetables.¹ Goods produced in the former tribal areas (FATA and PATA) also saw their framework change. The Finance Act, 2025, partially withdrew earlier exemptions and introduced a phased 10 percent sales tax, moving those goods from full exemption to concessionary treatment under the Eighth Schedule instead of the Sixth.⁵ Businesses that assumed the older exemptions would continue now owe tax they had not budgeted for.

Always work from the most recently amended version of the Act, available on the FBR website. Relying on a version even a year out of date can expose you to underpayment.

Invoicing, Reporting, and Penalties

Getting the exemption right on paper matters as much as getting the tax treatment right. When you sell an exempt item, the invoice should reference the specific entry number from the 6th Schedule that covers the good. That creates an audit trail and prevents the transaction from being reclassified later.

Exempt sales must still be reported in your monthly sales tax return filed through the IRIS portal. Because exempt supplies are not taxable supplies, they sit outside the main output tax calculation, but leaving them out of the return altogether can draw a penalty. Under Section 33 of the Act, the general penalty for contravening any provision is five thousand rupees or three percent of the tax involved, whichever is higher.¹ More serious offenses carry heavier consequences:

Issuing an unauthorized tax invoice: ten thousand rupees or five percent of the tax involved, whichever is higher.
Submitting false or forged documents: twenty-five thousand rupees or one hundred percent of the tax involved, whichever is higher, plus possible imprisonment of up to five years.
Failure to file a return on time: five thousand rupees, reduced to one hundred rupees per day if the return is filed within fifteen days of the due date.

These penalties sit in Section 33 of the Act.¹ Retain copies of exemption certificates, import documents, and invoices for at least the period covered by the statute of limitations on tax assessments. That paper trail is what turns a claimed exemption into a defensible one.

1
Federal Board of Revenue. Sales Tax Act 1990 Updated up to 2025-26
2
Government of Pakistan Revenue Division Central Board of Revenue. Sales Tax Act 1990 The Sixth Schedule
3
Federal Board of Revenue. Income Tax Ordinance 2001 Amended up to 31-07-2025
4
Board of Investment – Government of Pakistan. Incentives Database
5
Press Information Department – Government of Pakistan. FBR Issues CGO-08-2025 to Reinforce Secure Tracked Transportation for Tribal Areas