FBR of Pakistan has officially removed the Digital Presence Proceeds Tax on goods and services purchased online from international sellers.
This decision applies retroactively from July 1, 2025, meaning orders placed after that date will no longer be subject to the levy.
The 5% tax was originally introduced in the 2025 federal budget as part of efforts to regulate cross-border e-commerce. It specifically targeted foreign online shopping platforms such as Temu, Shein, and AliExpress, which had become increasingly popular among Pakistani consumers for offering a wide range of affordable products.
Supporters of the tax, including some local retailers, believed it would help level the playing field by making imported items less competitive compared to locally sold goods. They argued that without such measures, local businesses would continue to lose customers to cheaper foreign alternatives.
However, the withdrawal suggests a shift in policy priorities, possibly aimed at encouraging more consumer choice, fostering international trade, and avoiding additional costs for online shoppers.
E-commerce in Pakistan has been growing rapidly, with foreign platforms playing a major role in expanding options for buyers. Removing the tax may further boost online shopping activity, particularly for products not easily available in local markets.
By scrapping the Digital Presence Proceeds Tax, the FBR has signaled its willingness to adapt policies to changing economic needs and market realities, ensuring both consumers and businesses can benefit from the evolving digital marketplace.
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