The Federal Board of Revenue (FBR) has proposed a special tax procedure for small shopkeepers, under which Inland Revenue officers will not be allowed to enter registered shops displaying an official FBR “Green Plate.”
The draft procedure has been issued through S.R.O. 1109(I)/2026 and applies to individual retailers with an annual turnover of up to Rs. 200 million for tax year 2026.
Under the proposed scheme, eligible shopkeepers will file a simplified tax return through the IRIS web portal or a dedicated mobile application. They will be required to declare sales, purchases, expenses, net profit, and legitimate assets. The forms will also be made available in Urdu and regional languages.
Eligible retailers will pay income tax at the rate of 1 percent of gross turnover and will be allowed to adjust withholding tax against their liability. However, participants will have to pay a minimum tax of Rs. 25,000 with their annual return, or the tax payable after adjustments, whichever is higher.
Registered shopkeepers will receive an FBR-compliant Green Plate carrying a QR code, the owner’s name, National Tax Number, and shop address. According to the FBR, no tax officer or official will be permitted to enter a shop displaying the plate for tax-related matters.
The scheme will be optional and will not be available to retailers whose annual turnover exceeded Rs. 200 million in any of the previous three years. It will also exclude owners of multiple shops, Tier-1 retailers, jewelry sellers, and providers of professional services such as doctors, engineers, and lawyers.
Existing retailers who filed returns for tax year 2025 may also opt into the scheme, provided they do not reduce their tax liability or restructure their business only to qualify.
The FBR aims to bring more than three million retailers into the fixed tax scheme. Shopkeepers opting for the scheme will generally not be subject to audit.
The tax authority has invited objections and suggestions on the draft within seven days of its publication in the official Gazette before finalising the procedure.
