FBR’s Asan Tax Scheme, 1016 returns filed

The Asan Tax Scheme, introduced by the government to include small traders and shopkeepers in the tax system, is currently facing limited response. According to the latest data from the FBR, 1016 tax returns have been filed under the scheme so far.

Importantly, only 91 of these returns are of people who have become part of the tax system for the first time. This suggests that the main goal of the scheme, i.e., bringing shopkeepers who were previously outside the system into the tax net, has not yet been fully achieved.

The FBR has also informed the International Monetary Fund about the progress of the scheme. The issue came up during the fourth review of Pakistan’s $7 billion loan program with the IMF. The IMF is interested in how much the government’s efforts to document the retail sector are yielding practical results.

According to official figures, the Asan Tax scheme has so far collected Rs86 million in tax. The government has set a target of collecting Rs50 billion through the Retailers Fixed Scheme this fiscal year. The significant gap between the current collection and the target is a major challenge for the scheme.

The government has extended the last date for filing tax returns from September 30 to October 15. This extra time has given shopkeepers another chance to fulfill their tax obligations. However, the focus now is on whether more retailers join the scheme during this grace period.

Earlier too, the government has taken various steps to bring traders into the tax system. The current scheme is being seen as important in that it offers a relatively easy way for small businesses to pay taxes. The scheme, announced in June, was designed for businesses with an annual turnover of up to Rs 200 million.

The real test for the FBR is not just increasing the number of returns but also making new entrepreneurs a permanent part of the tax system. If the return filing and tax payment trend continues after registration, the scheme can help widen the tax net. Otherwise, it will be difficult to achieve the government’s ambitious revenue target by involving existing filers alone.