Under the scheme, the valuation of the shop, as determined by the FBR, will be used for tax imposition.
In a significant move, the caretaker government, following the IMF’s rejection of a fixed scheme for retailers, has finalized the ‘Tax Asaan Application’ to collect taxes from small shopkeepers. The scheme, expected to be effective from January 15, 2024, aims to bring millions of retailers into the tax net based on the valuation of each shop determined by the Federal Board of Revenue (FBR).
Salient features of the upcoming scheme for retailers include the inclusion of various businesses such as small traders, shopkeepers, service providers, franchise stores, medical practitioners, hospitals, educational institutions, health clubs, saloons, marriage halls, boutiques, tailoring shops, designers, interior designers, event managers, legal practitioners, travel agents, restaurants, tea houses, and pakwan centers.
Under the scheme, the valuation of the shop, as determined by the FBR, will be used for tax imposition. The government plans to introduce an easy installment plan of up to 12 installments, offering a 25% tax relief for newly registered persons. Additionally, relief from tax payments at the end of the year, hassle-free payments through digital platforms like Jazz Cash and Easypaisa, and fee-free consultations via “The Tax Asaan App” are part of the proposed scheme.
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It’s noteworthy that the caretaker government, armed with existing legislative powers, does not require new laws or amendments to impose the fresh tax scheme for retailers. The move is expected to face resistance from shopkeepers, and the government’s decision to either proceed or reconsider will be closely watched. The proposed scheme, with finalized features and a media campaign, awaits approval from the caretakers for launch.
