Karachi: Big retailers of the country are now being targeted by the Federal Board of Revenue as it sought to take action on such entities for tax evasion and bring them into the tax net, said an official at Regional Tax office (RTO)-III in Karachi.
In the budget for financial year 2017-18, the government revised the Sales Tax Act 1990 to bring big retailers into the tax net which was done by re-defining tier-1. As per the new amendments, these retailers will have to pay a 17pc sales tax under value-added mode.
According to FBR official, the RTO office is collecting data and monitoring the invoices issued by wholesalers, manufacturers and distributors to these retail outlets.
A tier-1 retailer is categorized as one which operates a unit of local or international chain of stores in an air-conditioned plaza, has a total electricity bill of Rs600,000 annually, has a unit which is involved in bulk import or supply of consumer goods on a wholesale/retail basis.
FBR official commented that RTO will be permitted to carry out regular audits and do a stock-take of these big retailers. Many big retailers were found indulged in tax evasion by RTO-III Karachi during last FY and were able to reclaim a huge amount from these entities.
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