E-Commerce Industry Urges Revisions to Budget 2025–26 Tax Measures

The Chainstore Association of Pakistan (CAP), Pakistan E-Commerce Association (PEA), and key digital stakeholders have urged the government to revise proposed tax and compliance measures in the Finance Bill 2025–26. Representing a sector valued at Rs. 2.2 trillion and growing at over 35% annually, the coalition warns that new rules—such as blanket 2% sales tax withholding, complex registration, and harsh penalties—will stifle digital entrepreneurship, particularly affecting youth and women.

They propose applying the 2% tax only to unregistered sellers, a unified 0.25% income tax withholding rate, and simplified registration for small/home-based sellers. They also request a 2–3 month transition period and dialogue with policymakers.

While welcoming the 5% levy on offshore platforms and better data reporting, the coalition criticizes the lack of consultation and rushed implementation, likening the move to the failed “Tajir Dost” scheme. They’ve appealed to top officials to pause enforcement and support inclusive digital growth.