The focal point of contention revolves around a recent notification amending rule 150ZEA of the sales tax rules, 2006, specifically targeting Tier-1 retailers under section 2(43A) (g) of the sales tax act, 1990.


Lahore: In a bid to address the concerns raised by members of the Lahore Chamber of Commerce & Industry, President LCCI, Kashif Anwar, on Sunday penned a letter to Chairman Federal Board of Revenue, Malik Amjed Zubair Tiwana, urging for amendments in S.R.O 1842(1)2023 dated 21-12-2023.
The focal point of contention revolves around a recent notification amending rule 150ZEA of the sales tax rules, 2006, specifically targeting Tier-1 retailers under section 2(43A) (g) of the sales tax act, 1990.
Under the revised rule, retailers with a deductible withholding tax under section 236 H of the Income Tax Ordinance 2001 exceeding Rs. 100,000/- in the last 12 months are now obligated to integrate with the point of sale (POS) system. Kashif Anwar pointed out that this amendment will affect retailers across 21 different sectors/products, citing their lack of expertise, technical know-how, and financial resources.
The crux of the matter lies in the additional burdens this places on retailers. He said that in the previous budget, the condition of 1000 sq ft was withdrawn because of the hard work of the business community and now this 236 H has been imposed instead of enhancing the turnover of retailers and reducing the tax rate by facilitating more and more unregistered persons to come into tax net.
President LCCI highlighted that compliance with the new regulations would necessitate hiring professional accountants for record maintenance, filing statements, reporting to the Federal Board of Revenue (FBR). Moreover, the installation of POS systems would further escalate costs for these already economically challenged retailers.
He said that it is not feasible to come into sales tax regime overnight as this will create problems for withholding retailers. He noted that this could negatively impact those who are already tax-compliant and documented, potentially discouraging the documented sector, and these overnight changes may result in refrain the unregistered retailers to come into the tax net.
The LCCI President expressed deep concern over the potential ramifications, asserting that these burdens could lead to severe challenges for retailers. Compliance difficulties may result in penalties, exacerbating their financial strain. Kashif Anwar stressed the urgency of the matter, calling for immediate intervention by Chairman FBR to address the predicament.
Kashif Anwar proposed a concrete solution in his letter. He urged Chairman FBR to consider amending the said SRO by substantially raising the prescribed threshold of deductible withholding tax for POS system integration. Specifically, he proposed an increase of deductible threshold from Rs. 100,000/- to Rs. 500,000/-. This adjustment would be a great favour to the retailers and will enable them to work smoothly. He said the outcome of this appeal could potentially shape the landscape for retailers, determining the ease of compliance with evolving tax regulations.

Bahraini National Guard Commander meets COAS Asim Munir
- an hour ago

Israeli’s worst bombing in Gaza, 200 Palestinians martyred, several injured
- 3 hours ago

2nd T20: New Zealand defeat Pakistan again
- 4 hours ago

Over 220 health facilities at risk of closure in Afghanistan, says WHO
- 15 hours ago

Anthropic’s plan to win the AI race
- 7 hours ago

Think twice before you smear beef tallow and salmon sperm on your face
- 5 hours ago

Pakistan, WB reaffirm commitment to economic reforms and sustainable development
- 14 hours ago

Current account deficit reduced by over $1bn in 8 months
- 2 hours ago

Actress Mariyam Nafees gives birth to first child
- 4 hours ago

Conservatives’ decades-long quest to destroy the Department of Education
- 5 hours ago

Mother, daughters kidnapped from Sheikhupura rescued in Lahore
- 2 hours ago

Three Khawarij militants killed in Khyber District operation: ISPR
- 14 hours ago