Key Takeaways
- The Federal Board of Revenue (FBR) has introduced a simplified tax procedure for small shopkeepers.
- Eligible retailers will pay income tax at the rate of 1 percent of gross turnover.
- Participants must display an FBR ‘Green Plate’ to avoid tax officers entering their shops.
The Federal Board of Revenue (FBR) has introduced a new simplified tax procedure for small shopkeepers, aimed at making the tax filing process more accessible and less intrusive. Under this scheme, individual retailers with an annual turnover of up to Rs. 200 million will be able to file their returns through a web portal or mobile application in Urdu and regional languages.
Eligible shopkeepers will pay income tax at a rate of 1 percent of gross turnover, which can be adjusted against withholding tax. However, they must pay a minimum tax of Rs. 25,000 with their annual return, or the tax payable after adjustments, whichever is higher. The FBR has stated that no tax officer will be permitted to enter shops displaying an official ‘Green Plate’ for tax-related matters.
The scheme applies to individual retailers who have not exceeded Rs. 200 million in annual turnover over the past three years and do not own multiple shops, are Tier 1 retailers, jewelry sellers, or providers of professional services such as doctors, engineers, and lawyers. Existing retailers who filed returns for tax year 2025 may also opt into the scheme provided they do not reduce their tax liability or restructure their business to qualify.
The FBR aims to bring more than three million retailers into this fixed tax scheme, reducing the burden of frequent audits and making compliance easier. Shopkeepers opting for the scheme will receive an FBR-compliant Green Plate featuring a QR code, the owner’s name, National Tax Number (NTN), and shop address.
The new procedure is part of the FBR's broader efforts to simplify tax processes and increase compliance among small businesses. The board has invited objections and suggestions on the draft within seven days of its publication in the official Gazette before finalizing the scheme.
