FBR waives tax on factory to warehouse movements in move to curb taxpayer harassment

The Federal Board of Revenue (FBR) has taken action to discourage harassment of taxpayers and simplify the transportation of goods by waiving sales tax on the transfer of items from factories to warehouses under the same Sales Tax Registration Number (STRN). This change does not require the issuance of a digital invoice for inter-premises movements.

However, a Stock Transfer Note (STN) must be included, clearly labeled "Stock Transfer — Not a Taxable Supply," following Sales Tax General Order No. 25 of 2026. The move is aimed at preventing misunderstandings during transit checks and to ensure proper tax adherence. Each consignment must carry the STN throughout its journey, which must be presented upon request.

If the receiving warehouse has a distinct STRN, the movement will be considered a taxable supply, necessitating digital invoicing and output tax accounting. The FBR has provided detailed Standard Operating Procedures (SOPs) to guide these transfers, ensuring compliance and preventing unwarranted scrutiny.