ISLAMABAD: New Tax Policy on Online Businesses sparks concern among importers in Pakistan as many of whom depend on digital platforms to manage and sell their goods. The government’s move to tighten tax compliance and documentation in the e-commerce sector is seen as a double-edged sword—aimed at increasing revenue but potentially hurting small and medium-sized traders.
Under the revised Finance Act 2025, online sellers are now subject to more rigorous scrutiny, including mandatory registration with the Federal Board of Revenue (FBR), real-time transaction tracking, and advance income tax on imported goods sold through e-commerce channels.
For importers operating in the digital space, the policy introduces fresh challenges as “Importing is already expensive due to duties, dollar fluctuations, and shipping delays,” said Salman Raza, an importer of mobile accessories based in Peshawar. “Now, with digital sales being taxed upfront, profit margins are vanishing. Small businesses like mine may not survive this.”
The FBR justifies the move by citing the need to widen the tax base and ensure fair taxation in the booming e-commerce sector. According to official estimates, Pakistan’s online market grew by over 35% in the past year, but a large portion of sales remains undocumented.
However, critics argue that the policy disproportionately affects smaller importers and online sellers who lack the resources to manage complex tax compliance.
“I understand the need for regulation,” said Amina Siddiq, who imports Korean skincare products and sells via Instagram. “But we weren’t given training or a grace period. One mistake in documentation can lead to penalties, and we’re already overwhelmed.”
Large platforms like Daraz and Alibaba Pakistan have reportedly begun complying with the new requirements, passing down compliance costs to third-party sellers on their platforms. Independent sellers operating through WhatsApp, Facebook, or TikTok Shop say they now feel caught in the crossfire.
To ease the transition, trade bodies have called for a phased implementation, clearer guidelines, and tax relief for small-scale importers. “This policy might help the economy in the long term,” said a local traders Niaz Muhammad“but without support mechanisms, it will crush the very businesses it aims to regulate.”
With mounting pressure, the FBR has hinted at possible amendments or leniency for micro-businesses, though no formal announcement has been made. For now, Pakistan’s online importers remain on edge—struggling to adapt to a new regulatory environment that may shape the future of digital trade in the country.
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