Karachi, January 5, 2025 – The Federal Board of Revenue (FBR) will impose strict penalties to address delays and non-compliance in filing sales tax returns, emphasizing the importance of timely submissions under the Sales Tax Act, 1990.
According to the FBR, individuals or entities failing to furnish sales tax returns by the due date will face financial repercussions. The prescribed penalty for such delays is PKR 10,000. However, a concessionary penalty applies to those filing their returns within ten days of the due date, amounting to PKR 200 per day of delay.
The FBR also outlined penalties for failing to meet other requirements under the Act. For instance, any individual who does not issue a proper invoice as mandated by law will be liable to pay a penalty of PKR 5,000 or 3% of the tax amount involved, whichever is higher.
In cases of unauthorized issuance of invoices that include a tax amount, stricter penalties are imposed. Offenders will be required to pay either PKR 10,000 or 5% of the tax amount involved, whichever is higher. These measures aim to ensure transparency and compliance within the tax system, reducing fraudulent practices and encouraging adherence to legal obligations.
The FBR’s directive highlights its commitment to improving tax administration and accountability in Pakistan. Businesses and individuals are advised to take these penalties seriously and ensure compliance to avoid unnecessary financial burdens. Timely filing of sales tax returns is essential not only to avoid penalties but also to maintain a smooth relationship with the tax authorities.
Tax consultants and professionals have welcomed these measures, considering them a step toward fostering a more disciplined tax environment. However, they have also urged the FBR to improve facilitation for taxpayers by enhancing online systems and addressing technical glitches, which can sometimes contribute to delays.
As the FBR continues its drive to improve tax compliance, taxpayers in Karachi and across Pakistan are encouraged to be proactive in meeting their obligations, ensuring their returns are filed accurately and on time.