Business Desk 
Jun 18, 2025
An undated image. — Depositphotos
In a fruitful move aimed at boosting the country's local e-commerce sector, the National Assembly Standing Committee on Finance and Revenue has approved the Digital Presence Proceeds Tax Act, 2025, which introduces a 5% tax on foreign vendors selling goods online in Pakistan.
The announcement was made during a high-level meeting chaired by Syed Naveed Qamar, Phoneworld reported, noting that the Act would primarily target foreign e-commerce sellers who supply goods to Pakistani customers without being physically present in the country.
Under the new tax law, banks and financial intermediaries will deduct the tax during payment transfers to these vendors, including platforms like Temu, which reportedly generated Rs 4 billion from Pakistani customers without paying any local tax.
Besides online retailers, digital advertisements from tech giants like Google to promote these vendors will also be taxed. These measures are being taken to align with international digital tax standards.
The newly approved legislation is expected to benefit Pakistan's local e-commerce industry by creating fair competition among prominent players in this realm.
That said, local sellers who are already paying domestic taxes will be able to compete with foreign platforms that previously enjoyed tax-free business.
Experts are of the view that ensuring price parity between local and international e-commerce entities would speed up the growth of Pakistani e-commerce platforms, while encouraging entrepreneurship and attracting investment in domestic technology infrastructure.
