Business Desk 
Aug 16, 2025
The Federal Board of Revenue (FBR) has imposed a cash transaction limit of Rs 200,000 at retailers and also for e-commerce transactions with cash on delivery (COD).
In a new income tax circular (No. 02 of 2025-26) released on Friday, the FBR notified that the limit would apply to both retail purchases made in a physical store and to COD online purchases.
Officials added that the limit was imposed under section 21(s) of the Income Tax Ordinance 2001. The new circular also stated that any payment above the Rs200,000 limit would not be treated as valid if it is made in cash.
While industry experts expect a major impact on the e-commerce businesses in Pakistan, with COD the most conventional mode of payment for online retailers, the policy is intended to push the transition to digital payment.
However, online retailers are more concerned about increased costs and the risk of consumer perception of a negative impact on those who would like to pay in cash.
This is part of the government’s larger push to move towards a cashless economy.
