Business

FBR initiates tax registration drive targeting retailers and shopkeepers

The Federal Board of Revenue (FBR) is moving forward with a plan to meet IMF requirements by initiating registration for retailers and shopkeepers in six major Pakistani cities.

Starting April 1st, this registration aims to broaden the tax base, with tax collection beginning on July 1st, 2024, in Islamabad, Karachi, Lahore, Quetta, and Peshawar. The FBR will integrate an Online Market Place Platform into the tax network to improve transparency.

Small traders and shopkeepers have special procedures outlined in the Special Revenue Order (SRO), mandating registration by April 30th under Ordinance 181, facilitated through the Tax App. A minimum monthly advance tax will be imposed based on income bracket, with an annual fee of Rs. 1200 for those with zero annual advance tax, but income tax-exempt individuals are exempt.

Those who pay their advance tax in full or balance it will receive a 25 percent reduction in overall advance tax liability. The FBR previously introduced the Merchant Friendly Scheme and ‘Merchant Friend’ mobile app to register traders outside the tax net.

On March 20, Pakistan reached a Staff-Level Agreement with the IMF on the final review of a $3 billion bailout package, securing $1.1 billion upon approval from the Fund’s Executive Board. This agreement highlights Pakistan’s commitment to implementing robust policy and reform measures for economic recovery.

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