The Federal Board of Revenue (FBR) has started taking strict actions against businesses that have not updated their systems to issue electronic sales tax invoices. The required deadline for compliance has already passed, and companies that have not adopted the e-invoicing method are now being checked for compliance, issued warnings, and may face financial penalties.
What Led to This Enforcement?
This initiative is part of the FBR’s broader effort to modernize Pakistan’s tax system.
By requiring real-time e-invoicing, the FBR aims to:
– Lower the amount of sales not reported
– Stop people from avoiding paying taxes
– Make the retail and wholesale sectors more open and clear
– Collect tax data more efficiently
This system ensures that every taxable sale is recorded automatically in the FBR’s central database.
Non-Compliant Businesses Are Now Being Checked
According to FBR officials, the following steps are already being taken:
– Sending warnings and penalty notices
– Conducting unexpected inspections of businesses that are at high risk
– Halting sales tax refunds for those not following the rules
– Possibly closing premises that keep breaking the rules
Tier-1 retailers were given enough time to set up their point of sale (POS) systems.
Those who did not follow the instructions are now being closely watched.
Penalties for Not Following E-Invoicing Rules
Companies that do not issue electronic sales tax invoices may face:
1) Large Financial Fines
Each non-compliant invoice could result in a significant penalty, especially if the issue happens repeatedly.
2) Temporary Closure of Business Outlets
The FBR may close a business unit until it fully complies with the rules.
3) Audit and Inspection
Non-compliant businesses will be added to the FBR’s high-risk audit list, which could lead to financial checks and a closer look at their activities.
Which Businesses Are Required to Comply?
The FBR has specified that the following sectors must adopt electronic sales tax invoicing:
– Tier-1 retailers
– Superstores, shopping malls, and branded outlets
– Restaurants and big food chains
– Wholesalers and distributors
– Online sellers who cross the taxable threshold
– Manufacturers supplying goods to retailers
– Any business in the above categories must connect their POS system to the FBR system as soon as possible.
How to Integrate With FBR’s POS/E-Invoicing System
To avoid penalties, businesses should complete the integration process quickly:
– Register for Sales Tax on the IRIS portal
– Verify business details under the POS integration section
– Install FBR-approved POS software or connect existing software via API
– Ensure that each invoice includes an FBR QR code
– Maintain constant internet access
– Test the invoice transmission to check real-time reporting
Once the integration is complete, all sales transactions will be automatically recorded in the FBR database.
Benefits of Complying On Time
Complying with the FBR’s e-invoicing system brings several advantages:
– Less chance of being audited
– Easier adjustment of input taxes
– Faster processing of refunds
– Better record-keeping
– Higher customer trust
– Lower risk of penalties
Conclusion
Since the mandatory deadline has passed, the FBR is now moving quickly to ensure that all businesses follow the e-invoicing rules.
Businesses are strongly encouraged to update their systems and follow FBR guidelines to avoid financial penalties, operational issues, and legal problems.
In the coming weeks, enforcement is expected to become even stronger, making it more important than ever to comply on time.
