Pakistan’s Fixed Tax Asaan Scheme has received just 1,571 income tax returns from small traders and shopkeepers, despite government efforts to bring more retail businesses into the formal tax system.
The scheme has generated approximately Rs140 million in tax payments, according to the latest figures reported on October 16.
The limited response comes as the Federal Board of Revenue (FBR) has extended the income tax return filing deadline to October 31, giving eligible taxpayers additional time to complete their submissions.
Registration has not translated into widespread filing
The government introduced the Fixed Tax Asaan Scheme to simplify income tax compliance for small retailers and encourage businesses operating outside the documented economy to register.
At a government review meeting on September 25, officials reported that 9,806 shopkeepers had joined the scheme during its first month, including 1,929 entering the tax system for the first time.
However, registration does not automatically mean that a trader has completed an income tax return.
The latest filing figures suggest that the scheme has yet to achieve broad participation among the country’s retail businesses.
How the scheme works
The Fixed Tax Asaan Scheme is available to eligible traders and shopkeepers with annual sales of up to Rs200 million.
Participants can file a simplified tax return and pay tax calculated at 1% of declared annual sales, subject to the scheme’s minimum annual payment of Rs25,000 and applicable adjustments for withholding tax already paid.
The government has also introduced a mobile application to simplify registration and return filing.
The scheme offers participating traders relief from certain routine compliance requirements, including point-of-sale installation obligations and routine tax inspections, subject to applicable conditions.
FBR working to address implementation problems
In an official statement issued on September 29, the FBR acknowledged that the scheme was still in its initial implementation phase.
The tax authority said it was working with trader organisations and market representatives to resolve registration difficulties and other practical problems.
At a further review meeting on October 9, Finance Minister Muhammad Aurangzeb emphasised that the scheme should not be treated as a one-year arrangement limited to 2026.
He said the government intended to provide small retailers with a simpler route into the formal tax system over the longer term.
What happens after the deadline?
With the filing deadline extended to October 31, the government has additional time to encourage participation.
However, the relatively small number of completed returns highlights the challenge of expanding Pakistan’s tax base through simplified voluntary filing arrangements.
The scheme’s longer-term effectiveness will depend on whether more shopkeepers complete their returns, whether technical problems are resolved and whether participation continues in future tax years.
Sources and attribution
- https://www.thenews.pk/print/1443201-fbr-extends-income-tax-return-filing-deadline-to-oct-31
- https://pid.gov.pk/site/press_detail/34073
- https://pid.gov.pk/site/press_detail/34094
- https://pid.gov.pk/site/press_detail/34232