FBR tightens tax enforcement for POS retailers, mandates digital payment integration

The Federal Board of Revenue (FBR) has introduced major changes in the regulations for retailers integrated with the point-of-sale (POS) system, making digital payment facilities mandatory at all sales points. 

According to a notification, the FBR has amended the Sales Tax Rules, 2006, through S.R.O. 69(I) 2025, revising the procedure for electronic integration of hardware and software used for generating and transmitting invoices. 

Retailers using the POS system will now be required to offer debit and credit card payment options, QR code scanning, or any other digital transaction method.

Under the new rules, electronic invoices must include a unique FBR invoice number, a verifiable QR code, software details, and other transaction-related information. If an integrated retailer fails to generate an invoice with a QR code or FBR invoice number, Inland Revenue officials will assess and recover unpaid taxes based on unaccounted sales.

Retailers must provide information about their outlets and electronic invoicing machines through the FBR’s online system. Sales will only be permitted through registered POS terminals. Invoices generated must include the recipient’s name, address, and registration number. 

The electronic invoicing system will encrypt and securely store sales data while transmitting it to the FBR in real-time. The system will also auto-fill Annexure-C of the sales tax return based on invoices issued by integrated retailers.

To ensure compliance, the FBR has set up a dedicated Inland Revenue enforcement network, which will conduct nationwide inspections at retail outlets using POS systems. 

Enforcement squads will patrol retailer premises to verify whether electronic invoicing software is properly integrated with the FBR and whether invoices are being reported in real time.

If non-integrated software is detected, the enforcement network will report the findings to the Commissioner of Inland Revenue, who will recover the applicable tax as per the Sales Tax Act. 

The new measures aim to curb tax evasion, improve compliance, and strengthen revenue collection from the retail sector.