KP Government Exempts Industries in Ex-FATA, PATA from Sales Tax
PESHAWAR – The Khyber Pakhtunkhwa government has granted sales tax exemption to industries operating in the former Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA).
The KP Revenue Authority has issued a formal notification in this regard.
According to the notification, the exemption applies strictly to industrial units established within the erstwhile FATA or PATA regions. To qualify for the tax relief, industrial units must also be registered as withholding agents.
The notification clarifies that services provided through virtual or remote means will not be covered under the sales tax exemption.
The tax exemption may be revoked if the prescribed conditions are not met or in case of misrepresentation or provision of false information, the notification warned.
The sales tax exemption notification will take effect from August 1, 2026, and will remain valid until June 30, 2028.
It was further stated that no claim for refund or adjustment of taxes deposited before the implementation of this notification will be entertained.
The decision is expected to provide significant relief to industries in the merged tribal districts and former PATA areas, aiming to promote industrial growth and economic activity in these historically underdeveloped regions.
