ISLAMABAD: In a significant pre-budget initiative aimed at expanding Pakistan’s tax base and promoting economic documentation, the government has introduced the Fixed Tax Asaan Scheme for small traders. The new voluntary tax framework offers simplified compliance procedures, exemption from routine audits, and relief from Point-of-Sale (POS) requirements in exchange for a fixed tax payment of one percent on declared annual sales.
The announcement was made jointly by Finance Minister Muhammad Aurangzeb, Minister of State for Finance Bilal Azhar Kiani, and Federal Board of Revenue (FBR) Member Hamid Attique Sarwar. The officials stated that the scheme was finalized after extensive consultations with trader organizations and business representatives across the country.
Under the Fixed Tax Asaan Scheme, businesses with an annual turnover of up to Rs200 million will be eligible to participate. Traders opting for the scheme will pay a fixed tax equivalent to one percent of their declared annual sales through a simple registration and filing process. The government has also announced that forms will be made available in all local languages to ensure ease of access and greater participation.
Bilal Azhar Kiani, who led discussions with the trader community, said the initiative was designed to address long-standing concerns regarding complicated tax procedures. He noted that the simplified mechanism would encourage voluntary compliance while reducing administrative burdens for small business owners.
Government officials estimate that the scheme could bring between 3.5 million and 4 million small traders into the tax net. The move is being viewed as a major step toward documenting Pakistan’s economy without introducing higher tax rates on existing taxpayers.
Finance Minister Muhammad Aurangzeb emphasized that broadening the tax base remains a key government priority. He said the objective is to reduce pressure on current taxpayers by encouraging more businesses to become part of the formal economy. According to the minister, sustainable economic growth depends on increasing participation in the tax system rather than repeatedly raising tax rates.
The new trader tax policy is expected to play an important role in Pakistan’s budget strategy for 2026. Analysts believe the Fixed Tax Asaan Scheme could improve revenue collection, support business confidence, and strengthen efforts to modernize the country's taxation framework while providing relief to millions of small traders across Pakistan.
