ISLAMABAD:

The Federal Board of Revenue (FBR) has announced new amendments to the income tax rules, focusing on the mandatory integration of electronic invoicing systems for various business sectors.

According to the FBR notification, businesses must comply with the new system within a specified period, after which penalties will be imposed for non-compliance or violations.

The proposed changes, outlined in the notification (S.R.O. 288(I)/2026), state that all registered businesses will be required to install point-of-sale (POS) systems and integrate them with the FBR’s centralised system. The decision applies to a wide range of sectors, including hotels, guesthouses, marriage halls, and various clubs, as well as intercity transport, courier services, and cargo operators.

Additionally, the new system mandates that beauty parlours, slimming centres, medical centres such as hair transplant clinics, private clinics, dental clinics, and plastic surgeons register with the FBR. Diagnostic laboratories, private hospitals, health clubs, gyms, and swimming pools will also be required to integrate into the system to ensure their transaction data is linked with FBR’s central database.

The notification further clarifies that large, well-known clubs such as Karachi Gymkhana, Lahore Gymkhana and Polo Club in Islamabad are also subject to the new requirement.

Moreover, chartered accounting firms, cost and management accounting firms and private educational institutions with fees of at least Rs1,000 per month will now be required to connect to the FBR’s digital invoicing system.

“Comments and suggestions on the proposed draft can be submitted within seven days. After the specified period, any suggestions and comments received will not be accepted, and the amended rules will be enforced through a Gazette notification,” stated the FBR notification.

A new chapter on online business integration has been introduced under these amendments, stipulating that all businesses listed in the schedule must link their POS systems and electronic invoicing software with FBR’s system.

Every sale will need to be documented with a real-time, verifiable electronic receipt containing a unique FBR invoice number and QR code, and all transaction data must be securely transmitted to FBR. Businesses will be required to retain this data for a minimum of six years.

The notification stresses that businesses must not conduct sales through non-integrated systems and must upload sales data within a specific timeframe in case of system malfunctions or internet disruptions.
Additionally, businesses may be required to connect their debit and credit card machines or other digital payment systems to the FBR’s network.

In compliance with the new rules, businesses will bear the cost of the integration process, including the purchase of hardware and software. Furthermore, a prominent signboard displaying FBR’s logo and the integration status of the business will be mandatory at all outlets.

The notification also introduces a licensing system for companies that will provide integration services, allowing only licensed entities to integrate businesses with FBR’s system. The license will be valid for five years, with a detailed procedure for application, approval, renewal and cancellation outlined in the rules.

Certain businesses, such as small retailers with low electricity consumption or those operating with minimal fees, may be exempt from these requirements. However, the goal of this initiative is to combat tax evasion, increase revenue, and foster transparency in business transactions.

The FBR aims to establish an Inland Revenue Enforcement Network to monitor compliance and ensure tax recovery in cases of unreported sales. The new digital invoicing system is expected to contribute significantly to the formalisation of the economy, ensuring that both taxpayers and consumers have confidence in the process.