The Chainstore Association of Pakistan (CAP), the official trade body representing the country's organised retail sector, has expressed grave concern over the deteriorating environment for tax-compliant retailers due to aggressive revenue enforcement measures and persistent failure of the Federal Board of Revenue's (FBR) Point of Sales (POS) integration system.
Comprising a large portion of Pakistan's retail and wholesale trade, the organised retail sector directly employs over one million people and supports a wide ecosystem, including shopping malls, manufacturers, service providers and the cottage industry. Retail brands are also growing contributors to export earnings through physical stores abroad and cross-border e-commerce.
Despite being the early adopters of POS system and generating 25-30% of their turnover in taxes, the compliant tier-1 retailers are now facing a perfect storm of high taxes, increasingly complex procedures, punitive enforcement and unresolved system issues, the association claimed.
This year alone, several regulatory instruments, including SRO 69(I)/2025, SRO 55(I)/2025 and the Tax Laws (Amendment) Ordinance 2025, have exacerbated the compliance burden without addressing POS system deficiencies. These include POS profile expiry disconnections, rendering invoices unverifiable; incorrect POS status flags showing "disconnected" despite active syncing; and weak support capacity of the Pakistan Revenue Automation Limited (PRAL) to address technical challenges.
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