Section 236X Advance Tax on Tobacco
Pakistan Tobacco Board or its contractors, at the time of collecting cess on tobacco, directly or indirectly, shall collect advance tax at the rate of five percent of the purchase value of tobacco from every person purchasing tobacco including manufacturers of cigarettes. Tax collected under this section shall be adjustable. The FBR has explained amendment made by Finance Act 2017 in Circular No. 4 of 2017 dated 6.9.2017 as under:
ADVANCE TAX ON TOBACCO.— A new provision has been introduced through the Finance Act, 2017 whereby the Pakistan Tobacco Board or its contractors are now legally obliged to collect advance tax @ 5% of the purchase value of tobacco from every person purchasing tobacco (including manufacturers of cigarettes) at the time of collecting cess on tobacco directly or indirectly.