Import SROs: the current landscape for importers

The landed cost of an import into Pakistan is built in layers: customs duty under the First Schedule to the Customs Act 1969, additional customs duty, regulatory duty, sales tax at import, and advance income tax collected under section 148 of the Income Tax Ordinance 2001 — offset, where available, by exemptions and concessions in the schedules and in statutory regulatory orders. Half a fiscal year into the new tariff policy, the stack is changing shape. This alert states the position as of late January 2026.

What changed

The Finance Act 2025 began implementing a multi-year tariff rationalization under the National Tariff Policy 2025-30: a phased withdrawal of additional customs duty, substantial cuts to regulatory duty across many tariff lines, and a simplified slab structure, with further steps scheduled in coming budgets [phase-out schedule, slab structure and line-by-line coverage — TO BE VERIFIED BY REVIEWING LAWYER].

Exemption practice has also tightened. Since the mid-2010s amendments to section 19 of the Customs Act and the parallel provisions of the sales tax and income tax statutes, new exemption notifications are constrained and generally lapse at the end of the financial year unless placed before and approved by Parliament [current mechanics — TO BE VERIFIED BY REVIEWING LAWYER]. Concessions now live mainly in the Fifth Schedule to the Customs Act and the Sixth and Eighth Schedules to the Sales Tax Act 1990, moved there from free-standing SROs.

Filing runs through one channel. Declarations and the permissions of the regulating agencies — plant protection, standards, drug regulation and others — are processed through the Pakistan Single Window under the Pakistan Single Window Act 2021, which has replaced separate counters [current scope of PSW integration — TO BE VERIFIED BY REVIEWING LAWYER]. The Import Policy Order 2022, issued under the Imports and Exports (Control) Act 1950, remains the gate for what may be imported at all, and it is amended frequently.

What it means

The rate you paid last quarter is not evidence of the rate you owe this quarter. Regulatory duty and additional duty notifications change mid-year, and the phased reductions mean the correct duty on a given HS code is now a moving target. Classification disputes become more valuable as the spread between slabs narrows on some lines and persists on others.

Concessions remain conditional, and the conditions are where the money is lost. Fifth Schedule and survey-based concessions typically require determinations of input requirements, end-use undertakings and post-import compliance [current survey and determination mechanics — TO BE VERIFIED BY REVIEWING LAWYER]. A breach converts the concession into a recovery: duty and taxes short-paid, default surcharge, and penalty. Customs' post-clearance audit reaches back through the record-retention period, which the statute sets in years, not months [period — TO BE VERIFIED BY REVIEWING LAWYER].

Valuation is its own contest. Values fixed by valuation rulings under section 25A of the Customs Act bind clearances until revised, and challenges run through revision under section 25D and onward [current appellate route — TO BE VERIFIED BY REVIEWING LAWYER]. An importer that clears at a ruling value it believes is wrong, without protest or challenge, has usually kept the problem and lost the remedy.

What this means for you

Re-run the duty build-up on your top tariff lines against the current notifications, not last year's clearances, and repeat the exercise after every Finance Act and mid-year SRO. For every concession you use, write down its conditions — determinations, end-use, consumption reporting — and assign someone to evidence compliance continuously, because the recovery notice will arrive years after the imports. Keep complete import records for the full statutory retention period in a form you can produce to a post-clearance audit. Where a valuation ruling overstates your goods, challenge it through the statutory route rather than absorbing it. And before committing to supply contracts priced on a concession, confirm the notification behind it has survived the most recent budget — annual lapse is now the default, not the exception.