Chainstore Association of Pakistan Urges Digital Payment Adoption

Retailers in Pakistan are expressing concern over the slow progress in documenting the retail trade, attributing it to various factors such as the stagnation of FBR-POS integration for tier-1 businesses and the lack of registration of small traders through the Tajir Dosd drive. They point out that the primary reasons for this slow progress include the absence of sustained consultation with the private sector, inconsistent policies, and increasingly complex procedures.

According to retailers, what is urgently needed is a clear five-year roadmap instead of ad-hoc measures to address these challenges. They believe that by gradually increasing the share of digital payments to 50% of the retail trade's contribution to the annual GDP, estimated to be over Rs12 trillion, significant progress can be made. Currently, an alarming 90% of the retail trade remains undocumented and undertaxed.

By implementing a reduced GST rate of 5% on just Rs2 trillion, it is estimated that indirect taxes of Rs100 billion can be generated, along with additional sums in direct taxes, surpassing the current tax collection figures. To expedite tax reforms and create a more favorable environment for compliant businesses, the Chainstore Association of Pakistan is calling for a swift adoption of digital payments in the retail sector. They emphasize the advantages of digital payments, such as improved transparency, reduced cash handling costs and risks, and simplified tax compliance.

In conclusion, the push for digital payments in the retail sector is seen as a crucial step towards enhancing documentation, increasing tax revenues, and fostering a more efficient business environment in Pakistan.