Karachi associations praise fixed tax regime for businesses with annual turnover up to Rs200m
Research conducted by Australia’s tax authorities revealed that the first communication a new taxpayer receives affects their long-run compliance behaviour. photo: file
KARACHI:
The federal government’s introduction of a 1% turnover tax and a fixed tax scheme for traders with annual turnover of up to Rs200 million has been welcomed by small traders in Karachi.
Small traders expressed hope that, following the implementation of the fixed tax regime, they will not be entangled in additional taxes or audit-related complications.
Karachi Electronics Dealers Association President Rizwan Irfan said the new tax scheme would bring ease and convenience for traders. According to him, the 1% turnover tax will help small and medium-sized businesses get rid of complex tax matters, while effective and transparent implementation will encourage more traders to join the tax net.
Karachi Wholesale Grocers Association Chairman Rauf Ibrahim stated that his association had proposed the introduction of the 1% turnover tax and fixed tax regime, which the federal government accepted in full and implemented, which Ibrahim called a timely step. He added that the announcement of this scheme has boosted confidence among small traders.
He further said that each small trader would now pay approximately Rs70 per day in taxes, which would neither significantly impact business costs nor disrupt commercial activities. He emphasised that traders should now play their role in making the scheme successful and fulfilling their national responsibility.
Anjuman Tajiran Karachi representative Javed Shams proposed setting a fixed annual tax of Rs20,000 under the scheme, stating that efforts are being made to bring as many small traders as possible into the fixed tax system. He welcomed the Rs200 million annual transaction threshold and thanked the government for accepting traders’ demands in the Budget 2026-27.
Trader leader Sharjeel Goplani noted that consultations had taken place between traders and the government regarding the fixed tax scheme, and traders are willing to pay taxes under this system. He expressed hope that traders will not face additional taxes or audit issues after its implementation.
Trader organisations maintain that a simple and easy tax system will not only promote business activity but also help bring new traders into the tax net, ultimately benefiting the national economy.
