FBR Limits Cash Payments to Rs 200,000

The Federal Board of Revenue (FBR) has officially set a cap of Rs 200,000 on cash transactions for both retail purchases and e-commerce Cash on Delivery (CoD) orders. This new rule, outlined in Circular No. 02 of 2025-26 (Income Tax), mirrors existing restrictions for retail outlets and now extends to online shopping payments.

The measure, implemented under Section 21(s) of the Income Tax Ordinance, 2001, is part of the government’s mission to promote a cashless economy, boost transparency, and make financial monitoring easier. It also aims to cut down on tax evasion by pushing people toward digital payment methods such as bank transfers and mobile wallets.

In practical terms, this means that whether you’re swiping your card at a mall or paying for that fancy imported coffee machine from an online store, the cash payment can’t exceed Rs 200,000.

The FBR believes this measure will simplify business transactions and help modernize Pakistan’s financial practices. And for those who enjoy the feel of a thick bundle of notes, it may be time to get comfortable with a card or a payment app instead.

Read more: FBR to Hire 102 Experts for Industry-Wide Audit