ISLAMABAD: The Federal Board of Revenue (FBR) has been empowered to impose an initial penalty of Rs 500,000 on sales tax-registered persons failing to integrate their invoicing systems with the tax authority, effective September 1, 2025.
According to official sources, the new enforcement primarily targets importers, public companies, and businesses with an annual turnover exceeding Rs 1 billion during the last twelve sales tax returns.
Under Section 25A of the Sales Tax Act, 1990, FBR field formations can now issue penalties against those who do not begin generating electronic invoices embedded with the FBR invoice number, QR code, and official logo. Repeat violations carry steeper penalties of Rs 1 million, Rs 2 million, and Rs 3 million.
Tax experts caution that any sales tax invoices issued outside the FBR’s digital invoicing system after September 1 will be deemed illegal. Purchasers of such invoices will also lose eligibility for input tax adjustments, posing risks to compliance and tax credits.
Industry observers note that public companies and large enterprises are generally positioned to meet the requirements of SRO 1413(I)/2025, making enforcement against them more viable. However, small, medium, and seasonal importers could encounter difficulties in immediately adapting to the integration requirements.
Tax specialists have urged the FBR to consider an extension of the deadline, especially given widespread disruptions caused by ongoing flooding across the country. Nonetheless, they recommend that registered taxpayers swiftly complete system integration and begin issuing electronic invoices to curb the use of unregistered or “flying” invoices, which undermine documentation and revenue collection.
