Islamabad: The Federal Board of Revenue (FBR) has set December 1 as the deadline for large-scale (tier-1) retailers to interlink their outlets (points of sale) with the taxation agency’s electronic system to enable real-time sales reporting, according to news sources.
The tier-1 retailers are defined in the notification as those outlets that operate a unit of national or international chain of stores, retailers operational in air-conditioned mall or whose electricity bill exceeds PKR 600,000 per month (kiosks excluded), wholesalers that bulk import and supply goods on both wholesale and retail basis.
The notice declared that in case of non-compliance, the retailers will not be entitled to the reduced 14% sales tax on the sale of finished fabric and locally made textile, textile-made-ups, leather and mock leather articles. The department plans to bring social media sales in the tax net and a 17% sales tax will be applicable to sales made through social media platforms.
The FBR recently issued notification for amendment in the Sales Tax Rules 2006 to bring large retailers, fertilizer, sugar, and cooking oil manufactures and strengthen the verification of bogus refunds. This step has been taken in light of the fact that these sectors have earned considerable profit, which is higher than the tax imposed in the budget (2019-20).
The FBR has also waived off the 1,000 sq ft definition of retailers as some smaller shops were making millions. The department has also declared it mandatory for brick manufactures to e-file their quarterly returns.
As per revised rules, the businesses including cafes, restaurants, coffee shops, snack bars eateries, and hotels will install the electronic device and software for online transmission of sales information in real-time.