What is the 236G rate for a distributor on the Active Taxpayers List and for one who is not?

The section 236G rate depends on two things: what the goods are (fertilizer or anything else) and whether the buyer appears on the Active Taxpayers’ List. The Income Tax Ordinance, 2001 as amended to 30 June 2026 gives the rates for tax year 2027, which runs from 1 July 2026 to 30 June 2027.

What does the law say?

Section 236G(1) requires every manufacturer or commercial importer selling to distributors, dealers and wholesalers to collect advance tax “at the rate specified in Division XIV of Part IV of the First Schedule”. That Division is the starting point for every buyer.

Section 100BA(1) then says that the collection of advance income tax in respect of a person not appearing on the Active Taxpayers’ List “shall be determined in accordance with the rules in the Tenth Schedule”, and section 100BA(2) gives the Tenth Schedule effect notwithstanding anything to the contrary in the Ordinance. So for a buyer off the list, the Tenth Schedule decides the rate.

What are the rates for tax year 2027?

Buyer and goods	Rate	Where it comes from
On the Active Taxpayers’ List, goods other than fertilizer	0.1%	Division XIV, Table, serial 2
On the Active Taxpayers’ List, fertilizer	0.7%	Division XIV, Table, serial 1
On both the income tax and sales tax Active Taxpayers’ Lists, fertilizer	0.25%	Division XIV, proviso
Not on the Active Taxpayers’ List, goods other than fertilizer	2%	Tenth Schedule, rule 1, third proviso Table, serial 3
Not on the Active Taxpayers’ List, fertilizer	See below	Tenth Schedule, rule 1, main words

The proviso to Division XIV reads that the rate on sale to distributors, dealers or wholesalers of fertilizer “shall be 0.25%, if they are already appearing on both the Active Taxpayers’ Lists issued under the provisions of the Sales Tax Act, 1990 and the Income Tax Ordinance, 2001”. Appearing on only one of the two lists does not meet those words.

What about fertilizer bought by someone not on the list?

Serial 3 of the Tenth Schedule Table applies to the gross amount of sale to distributors, dealers or wholesalers “other than sale of fertilizer”. Fertilizer is therefore outside that Table entry. The main words of rule 1 say that where tax is collected from persons not appearing on the Active Taxpayers’ List, the rate “shall be increased by hundred percent of the rate specified in this Ordinance”. Applied to the 0.7% Division XIV rate, that reading gives 1.4%. The Tenth Schedule does not print a 1.4% figure for fertilizer itself, so this is the arithmetic of rule 1 rather than a stated rate.

Worked example (illustrative figures)

Nadeem Traders in Gujranwala is a wholesaler of cooking utensils and buys from a manufacturer. In one invoice the gross amount of the sale is Rs. 2,500,000. The amount is invented; the rates are the ones above.

If Nadeem Traders is on the Active Taxpayers’ List:

1. Goods are other than fertilizer, so the rate is 0.1%.
2. Rs. 2,500,000 x 0.1% = Rs. 2,500.
3. Invoice total before sales tax and other charges: Rs. 2,500,000 + Rs. 2,500 = Rs. 2,502,500.

If Nadeem Traders is not on the Active Taxpayers’ List:

1. Rate under serial 3 of the Tenth Schedule Table: 2%.
2. Rs. 2,500,000 x 2% = Rs. 50,000.
3. Invoice total before sales tax and other charges: Rs. 2,500,000 + Rs. 50,000 = Rs. 2,550,000.

The difference on this one invoice is Rs. 50,000 minus Rs. 2,500 = Rs. 47,500, which is twenty times the ATL amount.

A fertilizer dealer in Sahiwal buying Rs. 1,000,000 of fertilizer:

Status	Rate	Tax
On both Active Taxpayers’ Lists	0.25%	Rs. 2,500
On the income tax list only	0.7%	Rs. 7,000
Not on the Active Taxpayers’ List (rule 1 reading)	1.4%	Rs. 14,000

What if I was on the list but filed my return late?

Section 100BA(1) still mentions persons on the Active Taxpayers’ List who have not filed a return by the due date. A rule 1A in the Tenth Schedule once set separate rates for them, but the footnote records that rule 1A was omitted by the Finance Act, 2026, and the rates it set were for property transactions, not for sales to distributors. In the text as amended to 30 June 2026, rule 1 speaks of persons “not appearing in the active taxpayers’ list”.

Common mistakes

• Doubling 0.1% to 0.2% for non-ATL buyers. That was the old filer and non-filer column, replaced in 2019. The Tenth Schedule Table now fixes 2% for non-fertilizer goods.
• Using 0.25% for fertilizer with only one ATL. The proviso needs both the Sales Tax Act and Income Tax Ordinance lists.
• Treating the higher rate as a penalty that cannot be credited. Section 236G(2) allows credit for “tax collected under sub-section (1)” without distinguishing the rate used.

What to check in the official text

Read Division XIV of Part IV of the First Schedule with its proviso, section 100BA, and rule 1 of the Tenth Schedule with the Table in its third proviso, all in the Ordinance amended to 30 June 2026. Whether a buyer appears on either Active Taxpayers’ List on the date of sale is a matter of the list itself, which is not part of the text held here.