The Federal Board of Revenue (FBR) in Pakistan has announced the initiation of a registration process for retailers and shopkeepers in six major cities. This move is part of efforts to comply with conditions set forth by the International Monetary Fund (IMF).
The registration process is scheduled to begin on April 1st, with tax collection starting from July 1st, 2024. The cities where registration will commence include Islamabad, Karachi, Lahore, Quetta, and Peshawar.
One significant aspect of this initiative is the integration of the Online Market Place Platform into the tax network, which aims to enhance transparency and efficiency in tax collection.
Special procedures have been established for small traders and shopkeepers, outlined in the Special Revenue Order (SRO) issued by the FBR. According to the scheme, every retailer and shopkeeper is required to apply for registration under Ordinance 181 by April 30th. The registration process can be conveniently carried out through the Tax App.
A minimum monthly advance tax will be imposed on individuals based on their income bracket. Those with an annual advance tax of zero will be subject to an annual fee of Rs. 1200. However, individuals exempt from income tax will be exempt from this requirement. Furthermore, those who pay their advance tax in full or balance it will enjoy a 25 percent reduction in their overall advance tax liability.
Earlier, the FBR introduced the Merchant Friendly Scheme to bring traders into the tax net. To facilitate this, the ‘Merchant Friend’ mobile app was launched to streamline the registration process. This user-friendly app enables the registration of traders outside the tax net, allowing the FBR access to records of shopkeepers’ income.
On March 20th, the International Monetary Fund (IMF) reached a Staff-Level Agreement (SLA) with Pakistan on the final review of a $3 billion bailout package. Following approval from the Fund’s Executive Board, Pakistan is set to receive $1.1 billion, marking the final tranche of the bailout package secured last summer. This agreement underscores Pakistan’s commitment to implementing robust policy and reform measures to foster a strong and sustainable economic recovery.
