In 2021, the Federal Board of Revenue (FBR) launched what was widely viewed as one of its most people-centric reforms—the Point-of-Sale (POS) Prize Scheme against Rs.1 payment on each purchase receipt. Its purpose was to document retail transactions and encourage citizens to demand receipts for every purchase, whether made in cash or through card. The idea was simple yet strategic: every invoice issued from a registered POS machine would feed into the national tax net, helping to curb evasion and promote formalization of the economy. To give this reform a participatory face, the FBR introduced a one-rupee fee on every invoice. This fee funded a Rs. 53 million monthly prize pool, through which ordinary consumers were rewarded for demanding receipts. For once, a fiscal reform carried a social message: compliance was not compulsion—it was collaboration.
Muhammad Arif
Then, without notice or explanation, the scheme disappeared. The last prize draw was held in late 2022, and on November 15 of that year, the scheme was officially “suspended.” But the one-rupee deduction never stopped. Every day, millions of Pakistanis continue to pay it, unknowingly contributing to a prize fund that no longer exists. By conservative estimates, this amounts to more than a billion rupees collected since the suspension. A Senate Standing Committee on Finance report from October 2024 revealed that between July 2023 and June 2024, Rs. 647 million had been collected, out of which Rs. 309 million was “utilized primarily for employee welfare.” Following a quiet rule change in February 2023, the public fund—originally created to incentivize documented transactions—was diverted to internal perks such as fuel subsidies, officers’ mess expenses, and staff allowances.
This diversion is not a technical adjustment; it is a breach of the public trust. The one-rupee contribution was never intended to be a tax. It was a voluntary public-participation mechanism—an emblem of partnership between citizens and the state. Redirecting these funds for bureaucratic welfare violates both the spirit and the law governing public finance. Article 79 of the Constitution and Section 23 of the Public Finance Management Act, 2019, stipulate that all public revenues must be credited to the Federal Consolidated Fund or a designated Public Account of the Federation, and can be spent only for the purposes for which they are collected. Altering the use of such funds without parliamentary approval or public disclosure constitutes a clear violation of fiscal integrity.
Equally troubling is the silence surrounding this diversion. The FBR’s website still lists the scheme as “temporarily suspended.” No official announcement was made to discontinue the collection of the fee or to explain the change in its use. The result is a de facto continuation of a charge under false pretenses. Citizens are paying into a non-existent scheme, their contributions redirected into administrative privileges rather than public incentives. This is a classic case of policy capture, where a public reform mechanism is quietly turned into an institutional benefit.
Such opacity corrodes the very foundation of governance. When public money collected for a defined, participatory purpose is quietly rechanneled for internal perks, it signals the collapse of accountability. Fiscal trust is not built by technology or automation; it is built by credibility. The Rs. 1 story is therefore not about the amount—it is about integrity. If the state cannot manage a one-rupee collection transparently, how can it expect citizens to trust its trillion-rupee budgets?
Globally, similar incentive-based tax schemes are subject to independent audits and public disclosure. The United Kingdom’s National Audit Office publishes annual utilization reports for every earmarked revenue scheme. India’s Comptroller and Auditor General regularly audits all incentive and rebate programs to ensure compliance with their stated purposes. Even Indonesia’s e-Lottery for tax receipts operates under a statutory transparency requirement, with every rupee accounted for. These systems demonstrate a basic truth: small contributions, when handled honestly, build large reserves of public confidence.
Pakistan’s governance structure, by contrast, seems determined to erode that confidence. The FBR’s handling of the POS scheme exemplifies a broader institutional pattern—initiatives begin with reformist intent but end as bureaucratic privileges. Instead of building trust in documentation, the FBR has discredited it. Instead of promoting voluntary compliance, it has reinforced cynicism. The original purpose of the Rs. 1 collection was behavioural—to make receipt culture habitual and make undocumented transactions socially unacceptable. That behavioral contract has now been broken.
Restoring public faith requires immediate, tangible actions. First, a special audit should be initiated by the Auditor General of Pakistan under Article 170(2) of the Constitution to trace every rupee collected since November 2022, including any interest earned and all expenditures made. Second, the one-rupee fee must be suspended immediately until the scheme is either lawfully reinstated or formally abolished through due process. Continuing to collect it without fulfilling its purpose violates the principle of “no taxation without representation.” Third, the Ministry of Finance should release a white paper disclosing the total amount collected, the legal basis of the February 2023 rule change, and the present status of the fund. Without these steps, the government cannot credibly claim to be pursuing documentation or transparency.
The FBR has in the past announced multiple taxpayer-incentive schemes—the Active Taxpayer List benefits, the Taxpayers’ Privilege and Honour Card for top contributors, various tax credits and rebates, and even sector-specific reliefs for construction and education. Yet, none of these have been sustained or institutionalized. Their sporadic appearance and quiet withdrawal reveal a deeper flaw: the absence of continuity, credibility, and communication in policy execution. Incentives only work when people believe in them. The failure of the POS Prize Scheme is not just an administrative lapse—it is a cautionary tale of how easily trust can be squandered in the pursuit of convenience.
Reclaiming the spirit of documented transactions, therefore, means far more than reviving a prize draw. It means reaffirming the sanctity of the public’s contribution, however small, and restoring faith that what citizens pay for a stated purpose is not misused for another. The culture of documentation can only grow in an environment where the state leads by example, not by extraction. The one-rupee question is not about money—it is about morality. Until the state accounts for that single rupee with honesty, every unprinted receipt will stand as a silent symbol of how far Pakistan remains from the goal of true fiscal transparency. (Opinions expressed in this article are the author’s own and do not necessarily reflect WNAM”s editorial policy).
The author is: Former Member (Gas), OGRA; Managing Partner at Arif & Associates, a boutique petroleum and business-law consultancy; and a thought leader in energy, governance, regulatory reform, and consumer-rights. Email: [email protected] | Cell: 0333-5191381
