Single Sales Tax Returns: A New Sales Tax Returns Portal

A new development has been put forward by the Federal Board of Revenue FBR by launching Single Sales Tax return portal across the country. This vital breakthrough is aimed at facilitating the taxpayers, promoting ease of doing business and to reduce compliance costs. This leads to a keynote and cornerstone achievement of the FBR with the development of this sales tax return portal. All this achievement, in a nutshell, amounts to a technological initiative towards automation, data integration and taxes harmonization. 

It would be relevant to share that the idea of the development of the Single Sales Tax Return was transformed into a reality right after discussion with the concerned authorities including provincial governments and their respective revenue bodies. The outline of the idea was also supported and backed by the input of other stakeholders: including taxpayers and tax practitioners. This digital sales tax return portal will in return ease the sales tax filing procedures and conjointly preserve the compliance costs. This initiative was the key recommendation for finance policy from the international financial organizations including World Bank and International Monetary Fund (IMF).    

The new sales return portal will assist in minimizing the data entry, simplifying the filing process, addressing the common data issues and also rectifying the calculation errors. The portal’s system will automatically handle and distribute input tax adjustments and tax payments across the sales tax authorities, also diminishing the necessity for reconciliations and payment transfers. Following the effectiveness of this portal’s system, the concerned officers of revenue bodies will have the functional capability and capacity to make better decisions with regard to the matters of the taxpayers. Additionally, it will empower the tax collection authority to further amplify the revenue collection and to enhance the tax compliance mechanism without audits. Adding one more benefit to the queue, the portal will emphasize on the harmonization of tax procedures, integration and coordination between the federal government and the provinces, which will in return promote national unity and ensure cohesion.  

Sales Tax on goods, in all over Pakistan, is collected by FBR and sales tax on services, in all over Pakistan, is collected by the respective territorial tax bodies of all four provinces. Sales tax on services in the Islamabad Capital Territory is also collected by the FBR. Meanwhile Azad Kashmir and Gilgit-Baltistan have their own tax regulatory bodies. 

Presently, the taxpayers have to file their monthly sales tax returns to multiple tax regulatory authorities, for example, a person supplying taxable goods and providing services across the country would have to file sales tax return with FBR, Punjab Revenue Authority, KPK Revenue authority, Baluchistan Revenue authority, and Sindh revenue board including respective revenue authorities of AJK and Gilgit-Baltistan. Following the above scenario is such a tiring and burdensome task before the formal advent of the single sales tax return portal that it could even lead to errors and miscalculations. Now, with the formal launching of this portal, the tax payers will now file only one sale tax return.

In this view, this new development will go on  play a vital role in transforming our indirect tax policy by broadening tax base, enhancing transparency, reducing the compliance burden and Improving administrative efficiency of the tax authorities enabling them to concentrate and tap on other potential areas of revenue sources.