FBR Removes Tax on Foreign Online Sellers

The Federal Board of Revenue (FBR) has suspended the Digital Presence Proceeds Act Tax from July 1, 2025, a move made to strike a trade deal with the United States. Finance Minister Muhammad Aurangzeb and senior officials are in Washington to finalize the agreement. The deal could boost Pakistan’s exports by several billion dollars and give it a trade edge over India, Bangladesh and Vietnam. The federal government has directed that the Digital Presence Proceeds Tax shall not apply to digitally ordered goods and services supplied from outside Pakistan by any person, which are chargeable to tax under the said Act, FBR said in a notification. This notification shall come into force on and from July 1, 2025, which means that the 5 percent tax imposed under the Act will no longer be applicable.