Only 220 new shopkeepers have joined the tax net under the government’s simplified registration scheme for retailers, despite the Federal Board of Revenue (FBR) identifying 3.6 million potential non-filers in the retail sector.
According to sources, just 1,750 shopkeepers have availed the scheme so far.
Only 1,750 retailers have filed tax returns under its new fixed tax scheme, with just 220 of them being new filers.
The scheme was introduced to widen the tax base and help the government collect Rs. 50 billion from the retail sector.
Fines and Shop Sealing for Non-Filers
To bring more retailers into the net, the FBR plans to geo-tag markets across the country, building on its nationwide mapping of markets and shops.
Shopkeepers who fail to register face escalating penalties. Non-filers could be fined Rs. 10,000 in the first month, Rs. 25,000 in the second month, and Rs. 50,000 in the third month. Authorities also have the power to seal the shops of retailers who stay outside the tax net.
The slow uptake follows earlier figures showing only 91 new retailers had joined the scheme in early October.
Revenue Shortfall Adds Pressure
The weak response comes as the FBR struggles to meet its revenue targets. The tax authority collected Rs. 975 billion in the first 30 days of October against a monthly target of Rs. 1,132 billion, a shortfall of Rs. 157 billion.
For the first four months of the current fiscal year (July to October), the FBR collected Rs. 4,058.5 billion against a target of Rs. 4,185 billion, leaving a gap of Rs. 126.5 billion.
Meanwhile, the deadline for filing income tax returns was extended twice this year. By October, the FBR had received 7.6 million income tax returns.
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