ISLAMABAD, May 2, 2024 — The Federal Board of Revenue (FBR) is ramping up efforts to register 3 million shopkeepers and traders under the Tajir Dost Scheme-2024.
The scheme, aimed at expanding the tax net, has appointed prominent business figure Muhammad Naeem Mir as its Chief Coordinator.
The announcement comes in the wake of a tepid response to the initiative, which had only managed to register a meager 100 retailers and shopkeepers by the end of April 2024. With the goal of dramatically increasing this number, Mir has been tasked with spearheading the registration drive across Pakistan.
Mir, who currently serves as the chairman of the Supreme Council of All Pakistan Anjuman-e-Tajiran, a significant trade organization, will play a critical role in liaising with trade bodies and ensuring that the scheme is implemented efficiently. According to the FBR’s notification, Mir is also authorized to involve members from various trade organizations to aid in this national effort.
The Tajir Dost Scheme was launched earlier this month with the intent to integrate over one million retailers into the formal economy by requiring all non-filers and unregistered traders to apply for registration under Section 181 of the Income Tax Ordinance 2001. However, the initial uptake was slow, prompting the FBR to take strategic steps to invigorate the program.
The slow initial registration rate has been a cause for concern at the FBR, which had set an ambitious target to bring 3 million shopkeepers and traders into the tax fold. The FBR believes that broadening the tax base is essential for increasing the government’s revenue and ensuring equitable taxation.
Mir’s appointment is seen as a strategic move to bridge the gap between the government and the business community. His deep connections and respect within the trader community are expected to ease mistrust and encourage more shopkeepers to register voluntarily.
Under the Tajir Dost Scheme, registered shopkeepers are expected to receive various benefits, including access to small business loans, simplified tax procedures, and protection against arbitrary taxation. These incentives are designed to alleviate common concerns among small traders about the perceived burdens of formal registration.
Economic analysts are watching closely, noting that the success of this scheme could serve as a model for other sectors. “If the FBR succeeds with the Tajir Dost Scheme, it could pave the way for more comprehensive tax reforms that are much needed in Pakistan’s informal economy sectors,” said an economist based in Islamabad.
As the scheme moves forward under Mir’s coordination, the coming months will be crucial in determining whether the ambitious target set by the FBR can be met and if the efforts to widen the tax net will pay off in fostering a more inclusive and compliant business environment in Pakistan.
