FBR to Make Major Changes to Trader-Friendly Tax Scheme
The Federal Board of Revenue (FBR) has announced plans to make major changes to its trader-friendly tax scheme. Instead of focusing on small traders, the FBR will now target larger retailers and shopkeepers based on reliable data and analysis.
New Approach to Tax Collection
Sources indicate that the FBR will begin registering major retailers and traders by analyzing their tax returns, electricity consumption, and other commercial data. This move is designed to ensure that taxes are collected from businesses that have a larger capacity to pay.
One of the significant changes is the suspension of the current fixed tax policy, which sets a set amount for each shop or retail outlet. This system will no longer be in place as the FBR shifts to a more targeted approach.
Impact on the Trader-Friendly Scheme
The new changes come as the FBR faces pressure to meet its revenue targets. For the first quarter, the FBR had aimed for a tax collection of Rs10 billion, and for the second quarter (October to December), the target is Rs23.4 billion through Tax Deducted at Source (TDS). The FBR has set a total target of Rs50 billion in TDS collection for the current fiscal year, as agreed with the International Monetary Fund (IMF).
