Income Tax Ordinance, 2001 — Section 148: Imports

148. Imports.— (1) The Collector of Customs shall collect advance tax from every importer of goods on the value of the goods at the rate specified in Part II of the First Schedule 2[in respect of goods classified in Parts I to III of the Twelfth Schedule] 3[: Provided that the Board may, by a notification in the official Gazette, add in the Twelfth Schedule any entry thereto or omit any entry therefrom or amend any entry therein: Provided further that in case of goods classified under Part III of the Twelfth Schedule which are used both as raw material and finished goods, the Board may, by notification in the official Gazette, specify that goods imported by a person or class of persons as raw material for its own use shall be treated as classified under Part II of the Twelfth Schedule, subject to such conditions and procedure as may be prescribed] 4[: Provided also that the Collector of Customs, shall not collect tax under this section, where the recipient of goods is also liable under the Digital Presence Proceeds tax, Act, 2025 and same has been collected by the payment intermediary as defined in section 153.] 1 Words “who was filer” substituted from Finance Act, 2019 2 The expression inserted through Finance Act, 2020 dated 30th June, 2020 3 The “full stop” substituted by “colon” and thereafter proviso added through Finance Act, 2020 dated 30th June, 2020 4 Full stop substituted and a new proviso inserted by the Finance Act, 2025. 304 Chapter X – Procedure 1[ 2[ ] ] 3[(2A) Notwithstanding omission of sub-section (2), any notification issued under the said sub-section and for the time being in force, shall continue to remain in force, unless 4[amended or] rescinded by the Board through notification in the official Gazette.”;] 5[ ] 6[ ] 7[ ]

(5)Advance tax shall be collected in the same manner and at the same time as the customs-duty payable in respect of the import or, if the goods are exempt from customs-duty, at the time customs-duty would be payable if the goods were dutiable. 1 Sub-section (2) substituted by the Finance Act, 2007. The substituted sub-section (2) read as follows: “(2) This section shall not apply to –

(a)the re-importation of re-usable containers for re-export qualifying for customs duty and sales tax exemption on temporary import under the Customs Notification No. S.R.O. 344(1)/95, dated the 25th day of April, 1995; or

(b)the importation of the following petroleum products – “Motor Spirit (MS), Furnace Oil (FO), JP-1 and MTBE”.” Chapter X – Procedure

(6)1[Subject to sub-section (6A), the] provisions of the Customs Act, 1969 (IV of 1969), in so far as relevant, shall apply to the collection of tax under this section. 2[(6A) The Board may, by notification in the official Gazette, determine the minimum value of goods for the purpose of collection of advance tax under this section.] 3[(7) The tax 4[required to be] collected under this section shall be 5[minimum] tax 6[ ] on the income of the importer arising from the imports subject to sub-section (1) and this sub-section shall not apply in the case of import of 7[goods on which tax is required to be collected under this section 8[ ] by an industrial undertaking for its own use.] 9[ ] 1 The word “The” substituted by the Finance Act, 2024. 2 Sub-section (6A) inserted by the Finance Act, 2024. 3 Sub-section (7) substituted by the Finance Act, 2006. The substituted sub-section (7) read as follows: “(7) Except in the case of an industrial undertaking importing goods as raw materials, plant, machinery and equipment for its own use, the tax collected under this section shall be a final tax on the income of the importer arising from the imports subject to sub-section (1).” 4 Inserted by the Finance Act, 2012. 5 Words “a final” substituted through Finance Act, 2019. 6 Expression “except as provided under sub-section (8)” omitted through Finance Act, 2019. 7 The expression inserted through Finance Act, 2020 dated 30th June, 2020 8 Words “at the rate of 1% or 2%” omitted by the Finance Act, 2022. 9 The hyphen and clauses (a),(c),(d)and (e) omitted through Finance Act 2020 dated 30th June, 2020 — (a) raw material, plant, machinery, equipment and parts by an industrial undertaking for its own use; []

(c)[motor vehicles] in CBU condition by manufacturer of [motor vehicles] [;] [(d) large import houses, who,

(i)have paid-up capital of exceeding Rs. [250] million;

(ii)have imports exceeding Rs.500 million during the tax year;

(iii)own total assets exceeding Rs [350] million at the close of the tax year;

(iv)is single object company;

(v)maintain computerized records of imports and sale of goods;

(vi)maintain a system for issuance of 100% cash receipts on sales;

(vii)present accounts for tax audit every year;

(viii)is registered9[under the Sales Tax Act, 1990] and

(ix)make sales of industrial raw material of manufacturer registered [Under the Sales Tax Act,1990] [; and] ] [(e) a foreign produced film imported for the purposes of screening and viewing.] 306 Chapter X – Procedure 1[(7A) Notwithstanding anything contained in sub-section (7), the tax required to be collected under this section shall be minimum tax on the income every person arising from imports of following goods –

(i)edible oil;

(ii)packaging material;

(iii)paper and paper board; or

(iv)plastics: Provided that the Board with the approval of Minister in-charge may, by a notification in the official Gazette, add any entry thereto or omit any entry therefrom or amend any entry therein this sub-section.] 2[ ]

(9)In this section – “Collector of Customs” means the person appointed as Collector of Customs under section 3 of the Customs Act, 1969 (IV of 1969), and includes a Deputy Collector of Customs, an Additional Collector of Customs, or an officer of customs appointed as such under the aforesaid section; 3[ ] 4[Value of goods means –

(a)in case of goods chargeable to tax at retail price under the Third Schedule of the Sales Tax Act, 1990, the retail price of such goods increased by sales tax payable in respect of the import and taxable supply of the goods; 5[ ] ] 1 The sub-section (7A) inserted by the Finance Act, 2022. 2 Sub-section (8) and (8A) omitted through Finance Act, 2020 dated 30th June 2020 the omitted sub section read as follows: [ ] [(8) The tax required to be collected from a person under this section shall be minimum tax for a tax year on the import of─ [(a)]

(b)edible oil;

(c)packing material; and

(d)plastic raw material imported by an industrial undertaking falling under PCT headings 39.01 to 39.12.] [(8A) The tax collected under this section at the time of import of ships by ship-breakers shall be [minimum] tax.] 3 The word “and” omitted by the Finance Act, 2004. 4 The expressions substituted by the Finance Act, 2020 dated 30th June, 2020 the substituted expressions read as follows: “value of the goods means the value of the goods as determined under the Customs Act, 1969 (IV of 1969), as if the goods were subject to ad valorem duty increased by the customs-duty, federal excise duty and sales tax, if any, payable in respect of the import of the goods.” 5 The word “and” omitted by the Finance Act, 2024. 307 Chapter X – Procedure

(b)in case of 1[goods other than those specified in clauses (a) and

(c)]; the value of the goods as determined under the Customs Act, 1969 (IV of 1969), as if the goods were subject to ad valorem duty increased by the custom-duty, federal excise duty and sales tax, if any, payable in respect of the import of the goods 2[; and] ; and]] 3[(c) minimum value as notified by the Board under subsection (6A) as if such goods were subject to ad valorem duty as increased by the custom-duty, federal excise duty and sales tax, payable in respect of the import of the goods.] 4[ ] 5[ ] Division III Deduction of Tax at Source