ISLAMABAD: The Federal Board of Revenue (FBR), Monday, informed Finance Minister Shaukat Tarin on the operational Terms of Reference (TORs) being implemented for integration of retailers into the Point of Sales (POS) system.
The finance minister chaired a steering committee meeting to review progress on broadening the tax base and integration of retailers into POS system by the Federal Board Revenue (FBR).
Tarin has directed to gather data by undertaking interim measures such as mystery shopping exercise to identify anomalies as well as adding new entrants into the system to yield efficient results under POS.
The FBR briefed the participants about operational TORs for integration of retailers into the POS system.
The TORs have been formulated in consultation with key stakeholders including representatives from the private sector to have a proper system of check and balance in place, the meeting was informed.
The FBR also informed the meeting that in order to facilitate and encourage integration of tier-1 retailers, the POS machines imported for installation on retail outlets as are integrated with the Board’s Computerized System have been granted exemption from sales tax. Moreover, sales tax rate on textile and leather items through POS integrated retailers has been reduced from 12 percent to 10 percent. Moreover, in order to enhance cost of retailers not integrated with the FBR’s online system, disallowance of input tax adjustment by such retailers has been further enhanced to 60 percent.
While reviewing the progress of the Steering Committee, the finance minister stated that limited tax base is one of the key challenges and the government is firmly committed to expand the tax base to enhance revenues exponentially.
He commended the efforts made by the members of the steering committee on the occasion.
The finance minister further stated that the government has incentivised the retailers by giving tax credit on electronic cash registers during the new budget 2021-22.
The underlying rationale is to give incentives to the taxpayers in order to broaden the tax base and at the same time, reiterated to take stern action against tax evaders who are not willing to be part of the tax net. The finance minister urged the FBR to strictly adhere to timelines and benchmarks and follow-up the whole exercise for broadening tax base on a regular basis.
Copyright Business Recorder, 2021
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