Minister of State for Finance Bilal Azhar Kayani emphasized on Wednesday that retailers must register with the Federal Board of Revenue (FBR), cautioning that those who remain unregistered will face strict enforcement actions and substantial fines. He made these remarks during a Senate Standing Committee on Finance meeting, chaired by Senator Saleem Mandviwalla, where discussions included the one percent fixed tax scheme for traders, retailer registration, tax returns, refunds, and special allowances for Senate staff.
Kayani explained that the retailer scheme was developed after extensive consultations with the business community. To date, 10,338 shops have registered, including 2,337 new retailers, though only 787 of these registered retailers are tax filers. He stressed that shopkeepers have no alternative but to register, warning that the FBR will take enforcement measures and impose penalties on those who fail to comply. The FBR is prepared to enter markets to ensure registration under the scheme.
FBR Chairman Rashid Langrial highlighted the unprecedented scale of work invested in this scheme. He noted that some level of strict enforcement is essential for retailer registration, cautioning that neglecting enforcement could jeopardize future initiatives. Langrial also pointed out that current registration numbers are below expectations, and efforts to promote the scheme include social media campaigns.
FBR Member Hamid Atiq Sarwar informed the committee that there are approximately 4.3 million retailers nationwide, of whom about 600,000 are registered filers. The FBR aims to bring an additional 500,000 to 700,000 retailers into the tax net, expecting around 200,000 to register voluntarily while the remainder will be incorporated through enforcement actions.
Committee member Farooq H Naek remarked that consultations limited to trader representatives are insufficient and called for a robust publicity campaign. He suggested the government conduct a continuous one-month awareness drive to better inform retailers about the scheme.
On the tax return front, FBR officials reported that 5.5 million tax returns have been filed so far this year, an increase of approximately 1.5 million compared to 4 million returns filed by the same time last year. They anticipate the total to reach 6.5 million by the end of Wednesday.
The committee also reviewed the status of tax refunds. Langrial stated that some refunds have already been disbursed, with the remaining cases being processed and expected to be cleared before the deadline.
The latter part of the meeting addressed special allowances for Senate staff. The Accountant General Pakistan Revenues informed the committee that the Supreme Court’s decision on the matter has been received, and other related cases might be reconsidered. Senator Mandviwalla argued that the Senate, as an independent institution, should have the authority to decide on its employees’ salaries and benefits. Naek supported this view, asserting that the Senate is Parliament and that the “relevant department” mentioned in the Supreme Court ruling does not refer to the Senate.
Mandviwalla gave the concerned authorities a 14-day deadline to resolve the issue and instructed that the matter be settled within this timeframe.
