The federal government is preparing to launch a new fixed tax scheme for retailers in the upcoming budget to expand the country’s tax base, according to sources within the Federal Board of Revenue (FBR).
Under the proposed plan, retailers across Pakistan with an annual turnover of up to Rs. 200 million will be required to register with tax authorities. The scheme introduces a fixed tax rate of 1% on yearly business turnover within the specified limit.
Sources revealed that the proposal will be presented to the International Monetary Fund (IMF) next week as part of ongoing discussions regarding tax reforms and revenue generation measures.
To simplify the process for small traders, the FBR has reportedly prepared the entire scheme in Urdu, making it easier for retailers to understand tax obligations and registration procedures.
Unlike earlier taxation models, the new framework will not consider the size or area of shops when determining tax liability.
The government aims to bring nearly three million retailers into the tax system through this initiative. Officials say lower tax rates and modest targets in the initial phase are intended to encourage wider participation and improve documentation of the retail sector in the new fiscal year.
