Finance Bill 2025-26 Proposes Major Tax Reforms for Non-Filers and E-Commerce Sector
Islamabad – June 16, 2025: The Federal Board of Revenue (FBR) has proposed key changes in the Finance Bill 2025-26 aimed at broadening the tax base and regulating the growing digital economy, ARY News reported.
One of the major proposals includes increasing the daily tax-free cash withdrawal limit for non-filers from Rs. 50,000 to Rs. 75,000. However, withdrawals beyond this limit will now be subject to a higher withholding tax of 0.8%, up from the previous 0.6%. This move is designed to encourage tax compliance and promote financial documentation among non-filers.
During a recent briefing to the National Assembly Standing Committee on Finance, FBR officials outlined several new tax measures targeting the e-commerce sector. Under the proposed bill, online clothing sales will be taxed at 2%, while electronics will face a 0.5% income tax. All other online businesses will be subject to a 1% tax rate.
Registered e-commerce businesses will be required to provide detailed customer billing information as part of their tax returns. Additionally, online platforms will be barred from passing on the tax burden to customers through extra charges.
The Finance Bill also introduces a significant increase in advance tax on digital services. Companies like Google, YouTube, and Facebook will see their tax rate rise from 10% to 15%. However, the government is offering an incentive for digital giants to establish a local presence — companies that set up offices in Pakistan will benefit from a reduced 5% tax rate.
To streamline tax collection, banks and courier companies will be designated as authorized agents, playing a critical role in enforcing the new regulations.
These comprehensive measures reflect the government’s broader strategy to improve transparency in financial transactions, ensure fair taxation, and regulate the fast-evolving digital and informal economies.
