The government has proposed to introduce a very simple and special “Fixed Tax Scheme” for small traders and shopkeepers across the country in the new federal budget.
The main objective of this scheme is to include more than 3.5 million small traders of the country in the tax net and document the country’s economy.
According to the proposal, this scheme will be for all small traders and shopkeepers whose annual turnover (total sales) is Rs 200 million or less. All such businesses will have to pay only 1 percent fixed tax on their total sales. With this move, the government hopes that an additional tax revenue of Rs 50 billion will be collected in the national exchequer.
To save the business community from the complicated tax system, the Federal Board of Revenue (FBR) has prepared a very simple return form of just one page. To join this scheme, traders will have to submit a registration fee of Rs 25,000 along with the return.
Traders registered under the scheme will be required to put up a special notice board outside their shop or business. The name of the trader and the National Tax Number (NTN) will be clearly mentioned on this board.
The government has given the option to traders to opt for this voluntary fixed tax scheme or to file their returns under the country’s general tax system. However, traders who remain outside both systems and do not get themselves registered will face strict legal action and heavy fines.
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