In a move aimed at expanding the tax base and formalizing the informal economy, the Federal Board of Revenue (FBR) has announced a one-month deadline for the tax registration of shopkeepers and traders.
As per the directive, every trader and shopkeeper is required by law to apply for registration with the Commissioner to obtain a “National Tax Number Certificate” by April 30, 2024. This can be done either through the Tax Asaan App, FBR’s portal, or at FBR’s Tax Facilitation Centers.
Under the newly introduced Tajir Dost (Special) Procedure, 2024 issued by the Federal Board of Revenue (FBR), traders will be obligated to pay a minimum monthly advance tax starting from July 1, 2024. This payment will be made through a separate Computerized Payment Receipt against the Payment Slip ID (PSID).
To formalize the process, the FBR has issued SRO 457(I) 2024 to notify the special procedure for small traders and shopkeepers. The draft of this procedure was initially published via Notification S.R.O. No. 420(l) 2024 on March 21, 2024.
The term “shopkeeper” encompasses various categories including wholesalers, dealers, retailers, manufacturer-cum-retailers, importer-cum-retailers, or any individual involved in both retail and wholesale activities within the supply chain of goods.
According to the finalized Tajir Dost (Special) Procedure, 2024, the special procedure will be applicable to traders and shopkeepers operating from fixed business premises such as shops, stores, warehouses, offices, or similar physical locations within the territorial civil limits, including cantonments in major cities like Karachi, Lahore, Islamabad, Rawalpindi, Quetta, and Peshawar.
For those who fail to register within the stipulated deadline, the Commissioner Inland Revenue will undertake the registration process on their behalf, as per the FBR’s statement.
Furthermore, the advance tax payable will be subject to a 25 percent reduction if the taxpayer chooses to pay the entire remaining advance tax for the relevant tax year in a lump sum before the due dates for payment. Similarly, if an individual who has not filed an income tax return for Tax Year 2023 does so before the due date for the first monthly installment, they will also benefit from a 25 percent reduction in the advance tax payable, according to the FBR.
The initiative marks a significant step towards formalizing the informal sector and ensuring greater compliance with tax regulations among shopkeepers and traders across Pakistan.
