ISLAMABAD: The Federal Board of Revenue (FBR) has ramped up its tax compliance efforts, instructing around 40,000 major retail outlets to connect their sales data with the FBR system for mandatory 24-hour reporting, The News reported. Non-compliance could result in the sealing of business premises.
On Monday, the FBR issued a Statutory Regulatory Order (SRO) detailing the procedures for sealing and de-sealing businesses found in violation of these rules.
There are currently 11,000 Tier-1 retail brands in the country, with their outlets numbering 40,000. The FBR discovered that these outlets were taking several days to submit their sales data, prompting a change in the Sales Tax rules to require all Tier-1 retailers to ensure their data is integrated within 24 hours for accurate sales reporting.
The FBR faced challenges when Tier-1 retailers argued that selling products at the same price for purchase and sale made little commercial sense, and they were not fully sharing their sales data with the FBR.
SRO 164 (1) 2025 issued on Monday specifies that business premises will be sealed if a retailer issues unverified invoices, becomes disconnected from the FBR database for 48 hours, fails to input offline invoices within 24 hours, or if the system fails to record invoices during the offline period.
The FBR also outlined the process for de-sealing. The Inland Revenue Commissioner will impose a penalty, and the business can be de-sealed within 24 hours of the penalty’s payment and the audit demand. Businesses can appeal the decision.
The commissioner will audit the software of all Point of Sale (POS) machines installed across retail branches within three days of de-sealing, ensuring that sales during the offline period are properly recorded. The audit will determine the extent of under-declared sales and the corresponding tax owed.
Failure to pay the penalty will lead to de-sealing after one month, with re-sealing occurring 15 days later if the issue persists. The commissioner will also enforce penalties as outlined under serial No. 25A of section 33 of the Sales Act and FBR rules.
