ISLAMABAD: The Federal Board of Revenue (FBR) made several amendments to the Sales Tax Act to include small retailers under the tax umbrella.
According to the amendment, small retailers (except those defined as Tier – 1) will pay fixed taxes based on monthly commercial electricity billings.
This method of the tax regime is meant to not only simplify taxes payment but also broaden the tax recovery horizon. As Federal Minister for Finance and Revenue, Miftah Ismail assured, “after the payment of the levied ‘final tax’, no further clearances will be required.” A key thing to note is that non-filers will pay almost double the taxes.
Criteria for tax payment for small retailers.
That’s why it is essential to become an active filter to enjoy the various subsidies that are being put out. As for the government, their agenda is to bring 300,000 of 900,000 retail shops, spread all over Pakistan, under a uniform tax policy. This means that regardless of the location, two small retailers will pay the same amount of taxes if their monthly commercial electricity bill is the same.
An important thing to keep in mind is that taxes will be levied on retailers that have registered commercial electricity connections. Therefore, retailers with domestic electric billings will largely go unmonitored.