Islamabad: The Government of Pakistan has introduced a new tax scheme to bring small shopkeepers and retailers into the formal tax system. Under the proposed plan, small retail businesses with an annual turnover of up to Rs200 million will be required to pay a simplified tax of 1% on their turnover.
The initiative is part of the government’s broader effort to expand the tax base, improve documentation of the retail sector, and increase revenue collection ahead of the 2026–27 federal budget. Officials say the scheme has been designed to be simple and business-friendly, encouraging voluntary registration by traders.
According to reports, millions of retailers operating outside the tax net could be brought into the system through this measure. The government hopes the new approach will succeed where previous schemes faced limited participation.
The proposal is expected to be formally announced as part of the upcoming federal budget, with authorities emphasizing that a broader tax base is essential for economic stability and sustainable growth.
