The Federal Board of Revenue (FBR) has unveiled sweeping reforms to modernize Pakistan’s tax infrastructure, targeting inefficiencies and revenue leaks. Through SRO69 of 2025, amendments to the Sales Tax Rules 2006 mandate the integration of electronic invoicing (e-invoicing) systems for registered businesses. This initiative aims to automate tax monitoring, enhance transparency, and bridge Pakistan’s staggering Rs4 trillion tax collection gap.
Key Changes at a Glance
- Mandatory POS Integration:
All registered businesses must integrate their point-of-sale (POS) systems with the FBR’s computerized platform to generate and transmit real-time electronic sales tax invoices. Licensed integrators, including FBR-designated Pakistan Revenue Automation Ltd (PRAL), will ensure secure, standardized data transmission. Specific business categories will be notified for compliance, while already integrated systems are deemed compliant. - E-Invoicing System Requirements:
- Generate invoices with unique QR codes and digital signatures.
- Encrypt data and transmit invoices instantly to FBR.
- Log adjustments, cancellations, or modifications for audit trails.
- Automatically flag discrepancies, triggering FBR alerts.
- Digital Payment Compliance:
POS systems must accept digital payments (debit/credit cards, QR codes). The FBR may enforce CCTV surveillance in transaction areas to deter fraud. - Visibility and Accountability:
Businesses must display signage at outlets confirming compliance with FBR e-invoicing rules, signaling accountability to customers and authorities. - Record-Keeping and Audits:
Maintain 6-year electronic records of all invoices, accessible during FBR audits. Systems must auto-generate detailed sales records, including seller/recipient details, tax amounts, and goods/services descriptions. - Licensed Integrators Only:
Integration services require FBR authorization. PRAL is currently the sole licensed provider, ensuring systems meet technical and security standards.
Penalties for Non-Compliance
The FBR has outlined strict consequences for violations:
- Tampering with invoicing systems or failure to integrate may result in heavy fines and disciplinary action under the Sales Tax Act.
- Non-compliant businesses risk audits, legal proceedings, and reputational damage.
Why This Matters
The reforms aim to:
- Curb tax evasion through real-time monitoring.
- Simplify compliance with automated processes.
- Boost revenue by closing digital loopholes.
- Enhance trust via transparency and QR-code-verified invoices.
Next Steps for Businesses
Registered entities must:
- Partner with licensed integrators like PRAL for POS/system integration.
- Train staff on e-invoicing protocols and digital payment handling.
- Ensure signage and surveillance requirements are met.
- Prepare for audits by maintaining meticulous records.
The FBR’s e-invoicing overhaul marks a pivotal shift toward a digitized, accountable tax ecosystem. While compliance demands upfront effort, the long-term benefits—reduced fraud, streamlined operations, and a stronger national revenue base—are transformative. Businesses must act swiftly to align with the new rules or face significant penalties.
FBR Introduces New E-Invoicing System to Boost Transparency and Revenue Collection
