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Govt decides to implement fixed tax regime for small retailers: Hammad Azhar

Govt decides to implement fixed tax regime for small retailers: Hammad Azhar

ISLAMABAD: The government has decided to implement fixed tax regime on small shopkeepers across the country to bring the sector under tax net, FBR official told media.

Official told that an initial draft has already been finalised and the regime will be implemented by April 15 after consultations with stakeholders including shopkeepers and their representatives.

“We have set a target for our self to implement the regime by April 15”, the official added. Another official, however, said the deadline is too narrow and is likely to be extended. Moreover, Minister of State for Revenue Hammad Azhar while speaking to media also said the project is in its infancy right now and did not share any details about the proposal.

As per the initial proposal, the tax rates are likely to be based on certain benchmarks such as the shop size, area, type of business or turnover. Move is for documentation purposes only; revenue potential to be nominal

“We have not decided on the final benchmark yet,” the official said while adding that the regime will only be limited to small shopkeepers.

The mode of payment, as per the initial working, will be either through token or in some other manner. The shopkeepers will be asked to display tokens on shop premises at a visible place in order to avoid harassment by tax officials. The token will serve as a proof that the business is tax compliant.

The revenue impact of this measure will be nominal as the final outcome will depend on the final scheme which will be implemented later, the official added.

The official said that two options are being considered for the implementation of this regime; either to introduce the tax to shopkeepers in Islamabad in the first phase or to introduce it across the country.

In this regard, the official added that representatives from the Federal Board of Revenue (FBR) held a meeting with stakeholders in Islamabad and “we are also planning to hold another meeting with shopkeepers from Islamabad and Lahore.”