Pakistan’s Federal Board of Revenue (FBR) has received only 130 income tax returns under its special tax scheme for small traders and shopkeepers, falling significantly short of its target of 500,000 to 600,000 filings.
According to a report published by The Express Tribune on October 15, 2026, the low response has raised concerns about the government’s efforts to bring more retailers into the formal tax system. The scheme was introduced to simplify tax compliance and encourage small businesses to fulfil their tax obligations.
Under the scheme, eligible traders can pay a minimum annual tax of Rs25,000 or 1 percent of their annual turnover, depending on the applicable calculation. They can submit a simplified, one-page tax return through the FBR’s Tax Asaan app or its online portal.
The initiative also aims to address traders’ concerns about complicated paperwork, professional filing fees and time-consuming procedures. Small shopkeepers who face difficulties using digital services can seek assistance at FBR taxpayer facilitation centres.
Another key feature is protection for participating traders from routine inspections, raids and shop sealing under the scheme’s applicable conditions. The government hopes these incentives will encourage businesses to register and comply with tax requirements.
However, the limited number of returns suggests that significant challenges remain in expanding Pakistan’s tax base. Earlier reports also highlighted technical problems with the registration process and weak participation from new taxpayers.
The government has been seeking to document the retail sector and increase revenue collection as part of wider economic reforms. The scheme’s performance is particularly important because Pakistan needs a broader tax base to reduce pressure on existing taxpayers and improve public finances.
The FBR will need to improve awareness, address practical difficulties and strengthen compliance measures if it wants the scheme to achieve its intended objectives.
