PCDMA seeks relief from FBR over confusion surrounding new sales tax requirement

KARACHI: The Pakistan Chemical and Dyes Merchants Association (PCDMA) has expressed serious concern over the difficulties traders are facing in filing their sales tax returns, following a new requirement introduced by the Federal Board of Revenue (FBR). Under SRO 55(I)/2025, the FBR has made it mandatory for all registered commercial importers, distributors, and wholesalers to declare their stock position in Annexure H1 with each monthly sales tax return.

However, PCDMA Chairperson Salim Valimuhammad said that the absence of clear guidance from the FBR has led to unnecessary confusion and hardship. He explained that many traders submitted their March 2025 returns without Annexure H1 simply because they did not understand the process. As a result, they were unable to declare their opening stock for April, and the issue remains unresolved even in June.

“PCDMA has received numerous complaints from members who are still unable to file their April 2025 returns due to this confusion,” Valimuhammad said. He added that many traders were forced to approach the FBR repeatedly for clarification. Eventually, the FBR allowed revised returns to be filed without amending Annexures A or C or requiring commissioner approval -- but by that time, it was too late for many.

To resolve the matter, PCDMA is urging the FBR to grant traders a 60- to 90-day grace period for submitting Annexure H1 after filing their returns. This would mirror the 120-day window already available to manufacturer-exporters.

“PCDMA believes that such decisions should be taken in consultation with trade bodies,” Valimuhammad said. He stressed that timely and clear communication is essential to ensure compliance and prevent similar issues in the future.