Tax & markets3 min read · Updated
VAT and sales tax for hardware stores in the UAE, the USA and Pakistan
How tax works at a hardware counter in the UAE (5% VAT), the USA (state and local sales tax) and Pakistan (sales tax), and how to set it up in a POS.
By Hardware Store POS Editorial Team · Published Key takeaways
- UAE: 5% VAT since 1 January 2018; show VAT-inclusive prices and issue tax invoices with your TRN.
- USA: no federal sales tax; most states and many localities charge their own rates.
- Pakistan: federal sales tax on goods (standard rate 18% at the time of writing) plus provincial taxes on services; large retailers face FBR integration rules.
- A POS sets rates and prints invoices; your accountant files the returns.
Tax is the part of a POS set-up owners worry about most, and the rules differ completely between our three markets. This is a plain-language overview of how it works at a hardware counter and how to set it up in the software. It is not tax advice; your accountant files your returns. Sources are linked at the end, checked on 18 October 2026.
UAE: 5% VAT, VAT-inclusive prices
The UAE introduced VAT on 1 January 2018 at a standard rate of 5%. For a hardware store that means:
- registering with the Federal Tax Authority above the mandatory threshold and getting a TRN;
- showing VAT-inclusive prices to customers;
- issuing tax invoices that show your TRN, the VAT amount and the customer’s TRN for business buyers;
- filing VAT returns, usually quarterly.
In the POS: create a 5% VAT rate, set prices as tax-inclusive, add your TRN to the invoice layout, store customer TRNs on their accounts, and use the tax report to prepare returns.
USA: state and local sales tax
There is no federal sales tax in the United States. Most states charge a statewide sales tax and many counties and cities add their own, so the rate depends on where the sale happens. A few states have no statewide sales tax.
For a hardware store:
- the combined rate (state + county + city) applies at your location;
- contractors buying for resale or exempt projects may give you an exemption or resale certificate;
- since the 2018 Wayfair decision, remote online sales can create tax obligations in other states above certain thresholds.
In the POS: create each rate once, combine them into a tax group per location, mark exempt customers on their account (keep certificates on file), and use the tax report. Online orders shipped out of state are a question for your accountant.
Pakistan: federal sales tax and provincial taxes
Pakistan charges sales tax on goods federally through the FBR, with a standard rate of 18% at the time of writing; provinces tax services. Registered businesses show their NTN/STRN on invoices.
Large retailers classed as Tier-1 are required to integrate their point-of-sale with FBR. Hardware Store POS does not include FBR integration, so a Tier-1 retailer should not rely on it for that requirement.
In the POS: set the rates that apply to your registration, show NTN/STRN on the invoice layout, and use the tax report. Many smaller shops quote prices ”+ applicable sales tax”.
Side by side
| UAE | USA | Pakistan | |
|---|---|---|---|
| Tax | VAT 5% | State + local sales tax | Federal sales tax on goods; provincial on services |
| Price display | Inclusive | Tax added at checkout | Commonly ”+ tax” for registered sellers |
| Your number | TRN | State permit | NTN / STRN |
| Exempt buyers | Zero-rated/exempt supplies as per law | Resale/exemption certificates | As per registration |
What a POS can and can’t do
It can store rates, combine them, apply them to items and customers, print compliant-looking invoices with your numbers, and report totals for your return. It can’t decide your rates, register you, or file for you, and it doesn’t hold any country certification.
Sources (checked 2026-10-18)
- UAE Federal Tax Authority — VAT
- US state sales tax rates (Tax Foundation)
- Federal Board of Revenue, Pakistan
Related: Countries & tax set-up · UAE · Pakistan · USA
Questions readers ask
- Do UAE prices have to include VAT?
- Prices shown to consumers in the UAE are expected to be VAT-inclusive. Tax invoices show the VAT amount and your TRN.
- Do all US states have sales tax?
- No. A handful of states have no statewide sales tax, though some localities in them do. Check your state and local rates.
- Is Hardware Store POS integrated with FBR?
- No. FBR point-of-sale integration is not included. If your business falls under the integration rules, talk to your accountant and to us before relying on the POS for that.
About the author
Hardware Store POS Editorial Team
The team that documents Hardware Store POS for hardware and building-supply retailers in the USA, the UAE and Pakistan.
- Written from the product's live configuration screens
- Reviewed against the published tax authority sources linked in each article
