LAHORE: Federal Board of Revenue (FBR) has directed 85 big retailers to integrate their businesses with the Point of Sale (POS) system.
In this regard, the FBR issued Sales Tax General Order (STGO) No. 04 of 2023 regarding mandatory integration of Tier-1 retailers with the FBR’s POS System.
The revenue body said that the Finance Act, 2019 added sub-section 6 to section 8B of the Sales Tax Act, 190 whereby a Tier-1 Retailer who did not integrate its retail outlet in the manner prescribed under sub-section 9A of Section 3 of the Sales Tax Act, 1990 during a tax period, its adjustable tax for the period would be reduced by 15 per cent. The figure of 15 per cent has been raised to 60 per cent through Finance Act, 2021.
The FBR further stated that in order to operationalize the important provision of law, a system-based approach has been adopted whereby all T-IRs who are liable to integrate but have not yet integrated, with effect from July 2021 (Sales Tax returns filed in August, 2021) are to be dealt with as per the procedure laid down in STGO No. 1 of 2022 issued on August 3, 2021.
Through latest STGO, the FBR issued a list of 85 Tier-1 retailers, directing them to integrate with the FBR system by October 10, 2022 and the procedure of exclusion from this list of 85 identified Tier-1 Retailers shall apply as laid down in STGO 17 of 2022 issued on May 13, 2022.
Upon filing of sales tax return for the month of October 2022 for all hereby notified Tier-1 retailers not having yet integrated, their input tax claim would be disallowed as above, without any further notice or proceedings, creating tax demand by the same amount.
