ISLAMABAD (Ahmed Mughal):- ُPakistan Govt has introduced two different laws to make compulsory business license to start any business activity and fix tax for retailers.

Business License

The Federal Board of Revenue (FBR) issued three different draft notifications on Thursday.

The FBR issued a draft notification “Obtaining and Issuance of Business License” for making binding law for getting business license.

Under the draft, “any person engaged in any business, profession or vocation, shall apply for business license in the FBR”.

The FBR also issued procedure for submission of application of the license. The applicant has to apply for the license through online system. The tax collecting authority also will get bio-metric verification of the applicant. The name of the successful applicant will appear in the active taxpayers.

Under the rules, the business license holders shall display the said license at every place of business. The license holer shall not be liable to payment of any tax on account of holding a business license unless such person is otherwise liable to payment of tax under any other provisions.  

Small Shopkeepers Scheme

FBR also issued a draft for “Small Shopkeepers Scheme” under section 99B of the Income Tax Ordinance, 2001.

Under the scheme, FBR suggested to divide small shopkeepers into four different categories.

Fix tax rates

These rates will be applicable on the shops in area specified as category A. The category means where a value of shop exceeds Rs.10, 000/square foot as per FBR valuation or DC rate.

“if the business activity carried out does not exceed 150 square feet, the shopkeeper has to pay fix tax Rs35,000 in tax year 2019 and 40,000 for tax year 2020”.

The business activity is carried out exceeds 150 square feet but does not exceed 300 square feet, the shopkeeper has to pay fix tax Rs40,000 in tax year 2019 and Rs.50,000 in 2020″.

“If the shop premises in which the business activity is carried out does not exceed 150 square feet, the shopkeeper has to pay fix tax Rs20,000 in tax year 2019 and Rs.25,000 in 2020”.

Under the draft, “If the shop premises in which the business activity is carried out exceeds 150 square feet but does not exceed 300 square feet, the shopkeeper has to pay fix tax Rs.25,000 in tax year 2019 and Rs.30,000 in 2020”.

Manners of payments

The shopkeeper shall pay fix tax through two installments. He has to pay first installment up to 30 Sept and second up to 31 Dec of every year.

FBR also give option for tax year 2019 to the shopkeeper to pay the tax         under rule 3 along with return.

FBR has also exempted to the shopkeeper from any audit of examination of taxmen under the scheme. The Board also exempt from withholding tax to shopkeeper.

The FBR also exempted to the shopkeeper from filing wealth statement.

The Board also introduced “income tax special procedure for traders“.

The draft automated non jurisdictional simplified tax regime for the traders. The board also prepared the scheme after practical research and discussion on the subject. It also did exclusive interaction with the trade bodies.

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