Which goods sold in shops are taxed on the printed retail price, and what did the Finance Act 2026 add?

The Third Schedule is the list of goods on which sales tax is worked out from the retail price printed on the pack, not from the invoice value. It matters to a shopkeeper because these are the everyday branded products on the shelves, and because the Finance Act, 2026 added twenty new entries.

What does the law say?

Section 3(2)(a) of the Sales Tax Act, 1990 says taxable supplies and imports of goods in the Third Schedule are charged at eighteen percent of the retail price. Where the same goods are also in the Eighth Schedule, the Eighth Schedule rates apply instead. The manufacturer, or the importer for imported goods, must print or emboss the retail price along with the amount of sales tax “legibly, prominently and indelibly” on each article, packet, container, package, cover or label.

Section 2(27) defines “retail price” for Third Schedule goods as the price fixed by the manufacturer or importer, inclusive of all duties, charges and taxes other than sales tax, at which the brand or variety is sold to the general body of consumers. If more than one price is fixed, the highest counts. For imported Third Schedule goods, the retail price cannot be less than 130 percent of the value determined under the Customs Act, 1969, including customs duties and federal excise duty.

Which goods were already on the list?

These serials were in the Third Schedule before the Finance Act, 2026 (serials omitted earlier are left out):

Serial	Goods
1 to 4	Fruit and vegetable juices; ice cream; aerated waters or beverages; syrups and squashes
5	Cigarettes
6 to 11	Toilet soap; detergents; shampoo; toothpaste; shaving cream; perfumery and cosmetics
14 to 16	Tea; powder drinks; milky drinks
17	Toilet paper and tissue paper
18	Spices sold in retail packing bearing brand names and trade marks
21	Shoe polish and shoe cream
33	Cement sold in retail packing
37	Mineral or bottled water
38	Household electrical goods, including air conditioners, refrigerators, deep freezers, televisions, recorders and players, electric bulbs, tube-lights, electric fans, electric irons, washing machines and telephone sets
39	Household gas appliances, including cooking range, ovens, geysers and gas heaters
40	Foam or spring mattresses and other foam products for household use
41	Paints, distempers, enamels, varnishes, thinners, polishes and similar goods sold in retail packing
42	Lubricating oils, brake fluids, transmission fluid and other vehicular fluids sold in retail packing
43, 44	Storage batteries; tyres and tubes (both excluding those sold to automotive manufacturers or assemblers)
45, 46	Motorcycles; auto rickshaws
47	Biscuits in retail packing with brand name
48	Tiles
49	Auto-parts in retail packing, excluding those sold to automotive manufacturers or assemblers
51	DAP
52 to 55	Imports of pet food for dogs and cats, coffee, chocolates and cereal bars, each sold in retail packing

What did the Finance Act 2026 add?

Section 4(17) of the Finance Act, 2026 added serials 56 to 75 after serial 55. Most entries apply only when the goods are “sold in retail packing” or “put up for retail sale”:

Serial	Goods
56	Vegetable and animal fats and oils
57	Sugar confectionery
58	Pasta, such as spaghetti, macaroni, noodles, lasagne, gnocchi, ravioli, cannelloni, and couscous
59	Sauces, ketchup, mixed condiments and seasonings, mustard flour and meal, prepared mustard
60	Fermented beverages
61	Petroleum jelly, paraffin wax and other mineral waxes
62	Plastic plates, sheets, film, foil, tape and strip
63	Plastic tableware, kitchenware, furniture, storage items, hygienic or toilet articles and other household articles
64	Trunks, suitcases, briefcases, school satchels, handbags, wallets, purses, travel and sports bags and similar containers
65	Footwear (all types), except where the manufacturer exclusively sells through digitally integrated and POS compliant retail outlets
66	Bathroom accessories and sanitaryware, including taps, showerheads, fittings, mixers and valves
67	Crockery items
68	Car and automobile accessories
69	Milk, fat-filled milk, preparations for infants and other milk products
70	Preparations for use on the hair
71	Shaving and after-shave preparations, personal deodorants, bath preparations, depilatories, other cosmetic or toilet preparations and room deodorisers
72	Toilet or facial tissue, towel or napkin stock and similar household paper
73	Jams, fruit jellies, marmalades, fruit or nut purees and pastes, and other fruit and vegetable preparations
74	Household utensils, including stainless steel, aluminium and melamine utensils and tableware
75	Ceramic products, including wash basins, commodes, tiles and allied ceramic sanitary products

The Note at the end of the Schedule says that where the Federal Government has notified a rate higher than eighteen percent, that higher rate continues after the goods are included in the Third Schedule.

Worked example (illustrative figures)

A Karachi manufacturer of tomato ketchup (serial 59) fixes a retail price of Rs. 400 for a bottle.

1. Sales tax: 18% x Rs. 400 = Rs. 72.
2. The label must show the retail price, Rs. 400, along with the sales tax, Rs. 72.

A footwear maker in Lahore that sells only through its own POS-integrated outlets falls within the exception in serial 65. A maker that also sells through ordinary wholesalers does not, because the exception needs the manufacturer to sell “exclusively” through such outlets.

What if an item is not clearly on the list?

Many entries point to “respective headings” of the customs tariff in column (3), so scope depends on the product’s classification. The Board can also add or remove goods by Gazette notification under the second proviso to section 3(2)(a), and the Federal Government can notify a higher rate under the first proviso. None of those notifications are held in this corpus, so this page cannot confirm the current position of any item they touch.

Common mistakes

• Treating “retail packing” as optional. For most new serials, loose or bulk goods are outside the entry.
• Assuming all footwear is covered. Serial 65 carves out makers selling exclusively through integrated POS outlets.
• Reading the retail price as tax-inclusive. Section 2(27) says the retail price includes all duties, charges and taxes other than sales tax, and section 3(2)(a) requires the tax to be printed alongside it.

What to check in the official text

Read the Third Schedule, including its Note, and sections 2(27) and 3(2)(a) of the Sales Tax Act as amended to 30 June 2026, and section 4(17) of the Finance Act, 2026. Check any Board notification including or excluding goods, any Federal Government notification of a higher rate, and the Eighth Schedule where an item appears in both. The customs tariff headings in column (3) decide borderline items.