Islamabad, November 6, 2024 – The Federal Board of Revenue (FBR) has announced significant revisions to its Tajir Dost Scheme, a tax initiative aimed at bringing shopkeepers and small traders into the tax net.
The adjustments focus on simplifying the scheme by refining the criteria for retailer registration and suspending the previous policy of fixed tax per shop.
Under the revised policy, the FBR will prioritize registration based on data-driven analysis, leveraging commercial electricity consumption records, tax return analysis, and secure data insights. This strategic shift intends to capture larger, high-potential retailers and shopkeepers, specifically targeting wholesale markets and premium retail zones. The FBR’s approach aims to increase efficiency by concentrating on traders with higher revenue potential and evidence of income concealment, rather than conducting exhaustive physical surveys or imposing a one-size-fits-all fixed tax.
The policy update emerged from a meeting between FBR officials and Muhammad Naeem Mir, Chief Coordinator of the Tajir Dost Scheme-2024. Mir noted that the FBR’s revised strategy reflects a practical acknowledgment of revenue realities, particularly the minimal fiscal contribution of very small traders. “There’s limited utility in registering minor shopkeepers who contribute insignificantly to the national exchequer,” he stated, emphasizing that the FBR will now pivot its focus toward retailers with a greater revenue footprint.
One of the hallmark features of the revamped scheme is its data-centric, non-intrusive methodology. Registration will now be grounded in verifiable information on tax evasion and income concealment, moving away from the door-to-door market surveys that previously characterized the FBR’s outreach efforts. In this refined model, shopkeepers will be assessed based on commercial electricity meter data and stock reports derived from filed tax returns, ensuring a more targeted approach toward tax liability estimation.
The decision to adopt this evidence-based model aligns with the FBR’s ambitious revenue collection target of PKR 50 billion from the retail sector. By honing in on larger retail players and identified tax evaders, the FBR aims to bolster its tax base without overburdening small traders, who contribute marginally to overall revenue.
To this end, the FBR’s analytical teams are now conducting an in-depth review of nil-filers and shopkeepers with declared stock positions, cross-referencing these with commercial electricity consumption to detect discrepancies. The revamped scheme signifies a critical shift in Pakistan’s tax administration, prioritizing impactful compliance over exhaustive coverage.
With the suspension of the fixed tax per shop policy, the FBR signals a commitment to equitable tax practices by ensuring that only substantial, tax-liable entities bear the tax burden. The revised Tajir Dost Scheme underscores a more precise and economically viable approach to retail sector taxation, aiming to enhance compliance and foster a fairer commercial tax landscape.
