Who will be exempted from Ecommerce Taxes in Pakistan and Online Registration in FBR

FBR Clarifies: Home-Based Sellers and One-Time Online Vendors Exempt from E-Commerce Tax Registration:

Date: June 16, 2025
By: Digital Economy Desk | Pakistan E-Commerce Association

In a significant development that brings relief to thousands of micro-sellers and home-based entrepreneurs, the Federal Board of Revenue (FBR) has clarified that one-time online sellers and home-based women entrepreneurs will not be required to register under the newly proposed e-commerce taxation framework included in the Finance Bill 2025–26.

Watch Complete Details in This Video:

The clarification came from FBR Chairman Rashid Mahmood Langrial, during a session of the Senate Standing Committee on Finance, addressing growing concerns across Pakistan’s retail, logistics, and digital commerce sectors.

📌 Key Highlights of the FBR Clarification:

✅ 1. Exemption for Small and One-Time Sellers

FBR stated that individuals who occasionally sell online, such as household items or handmade goods on social media or marketplaces, will not need to register as official e-commerce businesses. This includes:

• One-time or occasional online sellers

• Home-based women entrepreneurs running informal setups

• Social sellers who are not operating as formal businesses

This move was widely welcomed as a step to prevent unnecessary burden on low-scale sellers and to promote inclusion of women and micro-entrepreneurs in Pakistan’s digital economy.

📦 2. Courier Companies Made Tax Collection Agents

To curb tax evasion, the FBR revealed that courier companies handling deliveries for online sellers will now play a role in sales tax collection. As these companies already have access to invoices and shipping records, they can act as intermediaries to ensure transparency.

This decision aims to:

• Enforce compliance without disturbing small sellers

• Ensure GST collected from consumers reaches the FBR

• Reduce dependency on seller self-reporting

🌐 3. Foreign Digital Sellers Included

Any foreign e-commerce platform or digital service vendor that caters to Pakistani consumers will be required to comply with registration and tax obligations under the new laws. This includes:

• International websites selling goods to Pakistan

• Foreign SaaS or streaming services with Pakistani users

However, locally rendered services remain exempt from this new e-commerce tax rule.

⚖️ 4. Revisions in Arrest Powers Under Section 37A

In a related update, the FBR has revised the proposed arrest powers for tax officials. Originally criticized for being draconian, the new provisions mandate:

• An internal inquiry

• Approval from the commissioner before arrest

• Limited powers only in fraud cases exceeding Rs. 10 million

This step is intended to protect legitimate businesses from misuse while maintaining accountability for serious tax evaders.

💬 Industry Reaction

The announcement has been met with guarded optimism from e-commerce associations and business leaders. While clarity on exemptions is appreciated, the industry continues to call for:

• Simplified compliance rules

• Clear definitions of platforms vs sellers

• Protection for courier companies from undue liability

• Stakeholder engagement in policy execution

📣 What Happens Next?

The FBR will be submitting a revised draft of these clauses to the Senate Finance Committee shortly. The deliberations on the Finance Bill 2025–26 are ongoing, and further refinements are expected.

As Pakistan’s e-commerce ecosystem evolves, policy clarity and fairness will be key to building trust between the state and the digital economy.

✍️ Takeaway for Sellers and Entrepreneurs:

If you are:

• A small home-based seller

• A one-time or casual online vendor

• A social seller on platforms like Facebook, WhatsApp or Instagram

You are currently exempt from mandatory tax registration, according to FBR’s latest clarification. However, staying informed is crucial as implementation rules may still evolve.