Pakistan's Retailers' Tax Scheme Is Not a One-Year Deal, Finance Minister Says
Finance Minister Aurangzeb said on 9 October 2026 the Retailers Tax Scheme is not a one-year deal. Its rules cover 2026 only, and shops must file by 15 October.
Finance Minister Muhammad Aurangzeb said on Friday 9 October 2026 that Pakistan's Retailers' Tax Scheme for small shopkeepers "should not be viewed as a one-year arrangement limited to 2026". The rules in force today still cover Tax Year 2026 only, so nothing changes for shopkeepers yet, and their return deadline is 15 October 2026.
He made the remark while chairing a review of the scheme at the Finance Division in Islamabad, according to Press Information Department release No. 116. The Minister of State for Finance, the FBR Chairman and senior FBR officials attended.
We read the release, the scheme's notification on the FBR website, and the FBR circular that set the 15 October date. Here is what was said, what the law says, and what a shopkeeper should do this week.
The Finance Minister wants the scheme to run beyond 2026
Aurangzeb said the scheme is meant to give small retailers a simple way to enter the tax system and stay in it "in the years ahead". That is a statement of intent. No new notification extending the scheme to Tax Year 2027 has been published on the FBR website as of 10 October.
The release lists what the meeting covered:
- Progress on registrations and tax returns under the scheme, including existing taxpayers who joined.
- The tax payments the scheme requires.
- Efforts to find and map unregistered retailers using available data and identity records.
- FBR checks to make sure registration records match the real businesses behind them.
- Filing procedures, deadlines and related operational matters.
The release gives no new figures. It does not say how many shopkeepers have joined or filed since the last count, and it does not mention a further deadline extension.
The notified rules cover Tax Year 2026 only
The scheme is the FBR's Special Procedure for Small Shopkeepers, notified as S.R.O. 1166(I)/2026 on 27 July 2026 under section 99B of the Income Tax Ordinance. Its first paragraph says it "shall apply for tax year 2026". Running it again would need the FBR to issue fresh rules.
The main terms in the notification are set out below.
| Term | What S.R.O. 1166(I)/2026 says |
|---|---|
| Who it is for | Individuals earning mainly from a retail shop with sales up to Rs 200 million a year |
| Who is excluded | Owners of more than one shop, Tier-1 retailers, jewellers, professionals |
| Tax rate | 1 per cent of gross sales, less tax already withheld |
| Minimum payment | Rs 25,000 in cash with the return |
| Audit | Generally none, unless outside information points to misuse |
| POS machine | Not required for genuine shopkeepers in the scheme |
| Late penalty | Rs 10,000, then Rs 25,000, then Rs 50,000 |
| Years covered | Tax Year 2026 |
Shopkeepers who join also get a Green Plate with an FBR QR code for the shop front. The full eligibility test, a worked tax example and the filing steps are in our explainer on filing under the small shopkeeper scheme.
Uptake was slow at the last official count
The last published figures came from an earlier review on 25 September 2026. That meeting was told 9,806 shopkeepers had joined in the scheme's first month. Of those, 1,929 were new to the tax system, and only 428 had actually filed a return.
That is fewer than 1 in 20 of those who joined. The figures and the complaints behind them are in our report on the Asan Tax Scheme first month. Friday's release did not update them.
The plan to map unregistered retailers through data is the part to watch. It suggests the FBR will look for shops that are trading but not filing. The release does not say which data, or when any notices might go out.
Shopkeepers still have to file by 15 October 2026
Whatever happens to the scheme next year, the deadline for this year has not moved again. The FBR extended the Tax Year 2026 return date from 30 September to 15 October 2026 under section 214A, in Circular No. 3 of 2026-27. A shopkeeper who misses it faces the scheme's penalties.
- Decide whether you qualify: one shop, sales up to Rs 200 million, not a jeweller or professional.
- Work out 1 per cent of your sales from 1 July 2025 to 30 June 2026, less tax withheld from you.
- Pay that amount or Rs 25,000, whichever is higher.
- File the short return on IRIS, the FBR shopkeepers' app or with help at a tax office.
- Keep the acknowledgement, then check your filer status once the list updates.
The deadline note from the FBR is covered in our report on the 15 October extension.
What happens next
For the scheme to cover Tax Year 2027, the FBR would need to publish new rules, normally as a draft first and then as a final notification. Until that happens, the minister's words are a policy direction, not a rule. We will report any new notification when it appears on the FBR website.
Shopkeepers should not wait for it. The current rules give a fixed, simple route for this year only, and the price of missing 15 October starts at Rs 10,000.
Common questions
What did the Finance Minister say about the Retailers' Tax Scheme?
On 9 October 2026 he said the scheme should not be seen as a one-year arrangement limited to 2026, and that it should help small retailers stay in the tax system in future years.
Has the scheme been extended to 2027?
No. The notified rules, S.R.O. 1166(I)/2026, cover Tax Year 2026 only. No new notification was on the FBR website on 10 October 2026.
What is the deadline for shopkeepers to file?
15 October 2026, the date set by FBR Circular No. 3 of 2026-27 for Tax Year 2026 returns.
How much tax do shopkeepers pay under the scheme?
1 per cent of yearly sales, less tax already withheld, or Rs 25,000 in cash, whichever is higher.
What is the penalty for not filing?
Rs 10,000 for the first default, Rs 25,000 for the second and Rs 50,000 for the third, with at least a month between each.
How we verified this
What we checked, where we read it, and what we could not confirm.
Last checked at about 7pm PKT on 10 October 2026. We read Press Information Department release No. 116, "Finance Minister Reviews Progress on Retailers' Tax Scheme", dated 9 October 2026. We read S.R.O. 1166(I)/2026 of 27 July 2026 and FBR Circular No. 3 of 2026-27 of 30 September 2026 on the FBR website. The 25 September uptake figures come from an earlier government release. We checked the FBR press release page on 10 October and found no new extension or notification.
About the author
Tax, Bills and Technology Writer
Ali Akhtar is a young and curious voice here at Pakistan Era. He is currently pursuing his A-Levels and has a growing interest in Pakistan’s changing industrial landscape and educational trends. Ali likes to write in a way that helps him explain and explore the world around him. His writing reflects the perspective of the new generation navigating the evolving trends of Pakistan where technology, youth innovation, and shifting opportunities are reshaping the country’s future.
