ISLAMABAD: The Federal Board of Revenue (FBR) has launched a campaign to bring around 3.5 million small traders and shopkeepers into the formal tax system under a special taxation scheme.
The initiative aims to simplify registration for small businesses through a one-page form available in Urdu and regional languages, while offering traders a simplified tax regime and several compliance exemptions.
1% tax proposed for eligible traders
Under the scheme, shopkeepers with annual turnover of up to Rs200 million will be required to pay tax at a rate of 1%, according to an FBR notification.
The scheme also sets a minimum tax liability of Rs25,000 for eligible shopkeepers.
The initiative is designed to encourage small traders to register with the tax authorities without imposing the same compliance requirements applicable to larger businesses.
Traders exempt from audits and digital invoicing
Shopkeepers registered under the scheme will be exempt from point-of-sale (POS) and digital invoicing requirements, the FBR said.
Registered traders will also be exempt from tax audits and will not be required to act as withholding agents.
The FBR said tax officials would not be permitted to inspect shopkeepers registered under the scheme, providing further assurance to traders opting into the system.
Registration through website, app and tax offices
Traders will be able to register through the FBR website, its mobile application or designated tax offices.
A green plate carrying a QR code will be displayed at shops that comply with the scheme, allowing them to be identified as registered businesses.
The government hopes the simplified registration process and reduced compliance burden will encourage millions of small traders to enter the formal tax system.
