ByApplicability and Scope
The recently issued S.R.O. 69(I)/2025 by the Federal Board of Revenue (FBR) introduces amendments to the Sales Tax Rules, 2006, particularly focusing on the licensing, issuance of electronic sales tax invoices, and integration of registered businesses with FBR’s computerized system. Below is a detailed explanation of its key provisions:
- The new rules apply to all registered businesses required to integrate their hardware and software for generating and transmitting electronic invoices.
- FBR will notify specific businesses or categories through an official Gazette notification.
- Businesses already integrated with FBR’s computerized system will automatically be considered compliant under the new rules.
Integration Requirements
- Registered businesses (now termed as “integrated persons”) must:
- Install and integrate electronic invoicing hardware/software with FBR’s computerized system.
- Register their outlets, points of sale (POS), or electronic invoicing machines through FBR’s online system.
- Ensure that all sales are made exclusively through these integrated systems.
Functions of the Integrated System
The POS or electronic invoice issuing machine must:
- Generate, receive, record, analyze, and store invoice data.
- Issue sales tax invoices in a prescribed format, including a digital signature.
- Securely transmit invoice data to FBR’s system and receive a unique FBR invoice number.
- Encrypt and securely store the sales tax invoice data.
- Generate and print a QR code linked to the unique FBR invoice number.
- Perform daily, weekly, and monthly closings.
- Record all modifications, adjustments, or cancellations with proper logs.
- Auto-fill Annexure-C of the sales tax return using issued invoices.
- Detect errors, malpractices, or system inconsistencies and alert FBR’s system.
Additional Compliance Requirements
- Integrated businesses may be required to:
- Install debit/credit card payment systems at all sales points.
- Maintain CCTV recordings of sales transactions for at least one month and provide them to the Commissioner upon request.
- Issue electronic invoices even for exempt items.
- Bear the entire cost of integration, including equipment and software expenses.
Mandatory Display and Online Sales Integration
- Integrated businesses must:
- Display FBR’s official logo and a sign reading “Integrated with FBR” at their sales outlets.
- Ensure the registration number of each invoicing system is verifiable.
- Register their websites, mobile applications, and online marketplaces with FBR.
Required Invoice Details
An electronic invoice under this SRO must contain:
- Unique FBR invoice number (e.g., XXXXXXDDMMYYHHMMSS-0001).
- QR code (7x7mm dimensions).
- Registered electronic invoicing software number.
- FBR digital invoicing system logo.
- Seller and buyer details (names, addresses, and registration numbers).
- Date of invoice issuance and tax period.
- Description, quantity, and unit of measurement of goods.
- Value exclusive of tax, sales tax rate, and tax amount.
- Withholding tax, extra tax, and further tax (if applicable).
- Federal excise duty (if applicable).
- Discounts and invoice reference number.
- H.S. Code and applicable SRO number.
Certain details like withholding tax, extra tax, and SRO number may not be required for retailers selling to the general public, except for manufacturer-retailers or importer-retailers.
ImplicationsThis regulation aims to improve tax compliance and transparency but imposes significant financial and administrative burdens on businesses. Many retailers and small traders may struggle with costly integration, ongoing data management, and compliance monitoring. FBR’s strict enforcement of electronic invoicing may require businesses to hire tax consultants or IT professionals, increasing operational costs.
The Karachi Chamber of Commerce and Industry (KCCI) has raised concerns about the complexity and feasibility of this system, particularly for small businesses, and has urged the FBR to reconsider its approach.
