Islamabad: The Federal Board of Revenue (FBR) is set to launch on-ground surveys in three major cities—Karachi, Lahore, and Islamabad—in a bid to expand its retailer and wholesaler tax network. The initiative, which will utilize geo-tagging technology, aims to identify and connect potential taxpayers with Point of Sale (POS) machines to ensure greater tax compliance.
The move follows the failure of the Tajir Dost Scheme (TDS) to effectively bring retailers into the tax net, despite Finance Minister Mohammad Aurangzeb’s recent announcement that retailers had declared Rs413 billion in taxes this fiscal year, compared to Rs187 billion in the same period last year. However, the actual amount paid in Sales Tax and Income Tax remains unclear, and some of the declared tax has not yet been fully realized due to adjustments made during the process.
Sources revealed that the FBR is considering conducting surveys in high-traffic shopping areas, including large malls, to identify retailers and wholesalers not fully utilizing POS systems. The goal is to ensure that receipts generated by shops are properly accounted for through the machines. The survey will also target shops that may be connected to POS but are not generating receipts consistently through the system. If the pilot project proves successful, it will be expanded across the country.
A senior official from the FBR shared that the initial survey would begin in the coming week, focusing on prominent shopping centers in the three major cities. Currently, there are around 11,000 shops connected to POS systems nationwide, with that number doubling to nearly 22,000 when considering branches. However, the FBR estimates that between 50,000 and 100,000 shops nationwide should be using POS to meet tax compliance standards.
Under this new initiative, shops that generate receipts without POS systems will be subjected to penalties. The system, which has already been successfully implemented in restaurants and hotels in Islamabad, is expected to be expanded to more sectors.
The geo-tagging surveys are part of the FBR’s broader efforts to meet its revenue collection targets for the year. With the International Monetary Fund (IMF) pushing for Rs50 billion from retailers through the Tajir Dost Scheme, the FBR has collected less than Rs2 million so far, far below the target set for the current fiscal year.
To address this gap, the FBR is now shifting its focus to enforcement measures, utilizing technology to create a comprehensive database of retail businesses. These measures are expected to support the FBR’s revised annual tax collection target of Rs12.332 trillion, after the IMF lowered the original target from Rs12.970 trillion.
As the FBR moves ahead with these initiatives, the government remains committed to streamlining the tax collection process and ensuring that all sectors of the economy contribute fairly to the national revenue.
Samra Zulfiqar, a real estate analyst at Zameen.com, is passionate about finding projects that offer buyers the best returns. Her keen insights spotlight the market’s most promising opportunities.
