FBR E-Commerce Seller Registration: What Online Retailers in Pakistan Must Do Now

The Federal Board of Revenue (FBR) has introduced new rules to bring more e-commerce sellers into the tax system. The move is part of a broader push to increase tax collection from Pakistan’s growing digital economy and promote a shift toward cashless transactions.

FBR E-Commerce Seller Registration: What’s New?

This week, the FBR issued two key documents, Income Tax Circular No. 01 and Sales Tax Circular No. 02. These outline how e-commerce sellers must now register with the tax authority and how taxes will be collected on online sales.

From now on, all payments for goods or services sold online, whether through a website or a major platform like an online marketplace, will be taxed. This includes both domestic and export transactions.

Tax Collection at the Source

The FBR has made it clear that the responsibility to collect taxes doesn’t just fall on sellers. It now includes:

• Banks and payment apps – These financial platforms must withhold 1% tax on online transactions under new rules in Section 153(2A).

• Courier companies – Those handling cash-on-delivery (CoD) must collect 2% tax before passing the money to the seller.

These measures aim to push more sellers and customers toward digital payments by making cash-based transactions more expensive.

Final Tax on Digital Sales

Under a new section (6A), the collected tax will be treated as the final income tax for sellers, both for domestic and export orders. That means sellers won’t have to pay more tax on that income later.

Payment processors and couriers must also send monthly tax payments to the government and submit detailed reports on who they collected from.

Mandatory Registration for Online Sellers

The FBR now requires all online sellers to register for income tax. Marketplaces like Daraz or Foodpanda, and even courier companies, are banned from working with any seller who hasn’t registered.

Online platforms must also submit regular reports showing all vendors using their services. If they fail to do this or if they don’t collect the right amount of tax, they can be fined.

This applies to any seller with a website or app or using CoD, whether they sell independently or through platforms.

Sales Tax Rules Tightened Too

Couriers are now responsible for collecting sales tax on behalf of small sellers. If the seller is a cottage industry or a small business, the tax collected will be the final amount they owe. Larger businesses will still follow the regular sales tax system, but any withheld tax can be adjusted against their total liability.

The FBR has also expanded registration rules under Sections 14(1A) and 14(1B). All e-commerce vendors, including non-residents selling goods digitally within or from Pakistan via online marketplaces, must now register for sales tax.

In addition, Section 26 now requires online platforms, couriers, and payment intermediaries to file detailed monthly sales tax reports that list sellers, payments, and taxes.

E-Commerce Seller Registration: Why It Matters

These changes are meant to fix loopholes in the digital economy. By making couriers, banks, and platforms responsible for tax collection and reporting, the FBR hopes to bring more sellers into the formal economy.

This is a major step toward digital accountability and reducing tax evasion, but it also means online sellers now face stricter checks and must ensure full compliance to avoid penalties.

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