Small shopkeepers and retailers across Pakistan should prepare for a significant shift in the tax regime starting in 2025, reported 24NewsHD TV channel Tuesday.
According to a new notification, the average monthly sales of shops will be calculated to determine the advance income tax, which must be paid twice a year. Failure to comply with this requirement will result in the closure of the shop.
The new trader-friendly scheme will apply to 42 cities, expanding from the current 6. The scheme, set to start in the tax year 2025, mandates monthly advance income tax payments ranging from Rs 100 to Rs 20,000. The first collection is scheduled for July 31, 2024.
The scheme targets small businessmen, shopkeepers, wholesalers, retailers, manufacturers who also retail, and importer-retailers. The tax amount will depend on the shop’s location and the retailer’s minimum monthly sales average. Monitoring will be based on these sales averages.
Shopkeepers and traders can register for the scheme via a mobile app, the Federal Board of Revenue (FBR) web portal, or through tax facilitation centres. The move aims to streamline tax collection and increase compliance among small business owners.