ISLAMABAD: The Prime Minister’s Office announced on Wednesday that the retail sector paid an additional Rs455 billion in income tax during the fiscal year 2024–25. This figure was based on a briefing by the Federal Board of Revenue (FBR), which attributed the surge to the integration of point-of-sale systems and stricter enforcement.
FBR officials stated that the sector’s total income tax payments reached Rs617 billion, which included Rs316 billion in quarterly advance taxes paid by wholesalers, traders, retailers, and some corporate entities. However, sources noted that a broader definition of the “retail sector” was applied, encompassing firms beyond traditional retail.
Concerns were raised about the informality of the sector and the accuracy of the figures. According to sources, the actual retail sector paid Rs484 billion in FY24, suggesting a net increase of Rs133 billion instead of Rs455 billion.
Breakdown of Rs617 billion includes Rs316 billion in advance tax, Rs28 billion in admitted income tax, Rs216 billion in withholding tax, and Rs57 billion under other categories. PM Shehbaz Sharif chaired a meeting on FBR reforms and stressed the need for a digitized, transparent, and efficient tax system. He directed FBR to accelerate digital transformation, improve enforcement, and engage with stakeholders.
The Prime Minister emphasized that reforms should raise national revenue without burdening citizens. The FBR reported a historic 1.5% increase in the tax-to-GDP ratio, though it still missed the IMF’s target of 10.6%.
Additionally, the number of income tax return filers increased from 4.5 million in 2024 to 7.2 million by June 2025. Customs reforms under the faceless clearance system also showed progress, reducing clearance time significantly.
