Traders' one-percent fixed tax scheme facing difficulties
Published 1 hour ago | By Nouman Shakeel
The one-percent fixed tax scheme introduced by the government to bring traders into the tax system has failed to yield the expected results. Of the 317 shopkeepers who have availed themselves of the scheme so far, only two were not previously part of the tax system, while the remaining 315 were already tax filers.
The government had set a target to collect Rs50 billion in annual taxes from traders through this scheme during the current fiscal year; however, only Rs26 million has been collected to date. Based on these figures, the average collection per trader stands at approximately Rs81,944.
Minimal Inclusion of New Traders
According to officials, only two new shopkeepers have filed returns under the scheme so far—one from Quetta and the other from Rawalpindi. An additional 44 new traders have prepared their returns but have not yet submitted them.
Meanwhile, 6,631 traders prepared draft returns under the scheme, yet approximately 6,587 of them were already tax filers. This situation indicates that the scheme has not yet succeeded in bringing a significant number of unregistered traders into the tax net.
Highest Participation from Rawalpindi
In terms of city-wise participation, Rawalpindi saw the highest number of participants, with 87 shopkeepers joining the scheme; however, only one of them was a new filer. Traders from other cities also adopted the scheme: 61 from Lahore, 33 from Sahiwal, 25 from Sialkot, 24 from Karachi, and 23 from Islamabad.
The statutory deadline set by the government is September 30, and only one week remains. For this reason, the government has begun reviewing the lenient policy adopted for traders, while discussions regarding the scheme's design and future are also underway among relevant officials.
Bilal Azhar Kayani, the Minister of State for Finance, reviewed the progress of the fixed tax scheme on Tuesday. A decision was also made during the meeting to intensify the awareness campaign regarding the scheme.
What facilities are available to shopkeepers?
The government has set a fixed tax of one percent on annual sales for small retailers. In return, eligible shopkeepers have been provided with several facilities:
| Benefit | Details |
|---|---|
| Tax Audit | Exemption from regular tax audit |
| Point of Sale | Exemption from installing a POS system |
| Withholding Tax | Exemption from becoming a withholding tax agent |
| Business Premises | Restriction on FBR staff entering the business premises |
Shopkeepers who operate a single business outlet and whose annual sales have remained below Rs 200 million over the past three consecutive years are eligible to benefit from this scheme.
According to the Ministry of Finance, tax commissioners were also directed during the meeting to coordinate with local tax bars to facilitate shopkeepers in filing their tax returns through lawyers of their choice. The statutory deadline for traders to file their returns is September 30.
