ISLAMABAD: The Federal Board of Revenue expanded its point-of-sale tax network significantly during fiscal year 2025-26, with the number of large retailers linked to the system rising 31% to 17,337, according to official data.
The increase reflects a renewed push to bring more major retailers into the documented economy, while revenue generated through POS-linked businesses also rose during the year.
FBR data shows that 4,124 additional large retailers were connected to the POS system during FY2025-26, taking the total network to 17,337 businesses.
POS Receipt Revenue Rises 17%
The POS integration programme was introduced in December 2019 to electronically record retail transactions and transmit sales data directly to the tax authority.
Under the system, FBR receives Rs1 from each electronically generated purchase receipt. Official figures show that the authority collected Rs871 million through POS receipts during the last fiscal year, around 17% more than a year earlier.
Once a transaction is recorded electronically, a copy of the bill is transmitted to FBR in real time. This reduces the scope for businesses to later understate their actual sales because transaction records are already available with the tax authority.
Retailer Tax Collection Reaches Rs132 Billion
According to FBR figures, tax collection from POS-linked retailers reached Rs132 billion during the last fiscal year.
Officials said changes to withholding tax thresholds under Sections 236G and 236H of the Income Tax Ordinance also helped expand the POS network.
FBR has been focusing particularly on restaurants, textile outlets and garment retailers as part of its drive to widen the documented retail sector.
Small Trader Scheme Changes Retail Tax Landscape
The government’s separate tax scheme for small traders has introduced a different compliance structure for businesses with annual sales of up to Rs200 million.
Under the new scheme, eligible small traders are required to pay tax equal to 1% of their annual declared sales.
The new arrangement has raised questions about how quickly digital documentation will expand across the wider retail sector, particularly where different categories of businesses are subject to different compliance requirements.
Services Sector Still Largely Outside Tax Net
Tax officials said a large part of the services sector remains outside the documented tax system despite progress in retail integration.
According to officials, doctors and other professional service providers have shown resistance to declaring full income and transaction volumes or linking clinics and hospitals to electronic billing systems.
FBR officials maintain that electronic billing is intended to apply a common documentation standard rather than target any particular profession.
They said bringing retailers and restaurants into the electronic billing network has already contributed to higher tax liabilities and improved transaction visibility for the tax authority.
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