Technology

Online Stores and E-Commerce Companies will now be Taxed at 0.5%

Online Stores and E-Commerce Companies will now be Taxed at 0.5%

The e-commerce industry in Pakistan is booming especially after the arrival of 3G and 4G technology. The industry has met with huge success in the and growth in recent times, in terms of number of customers and sales volume.

This trend has in the ecommerce industry has traditional industries to benefit from the trend. Most of the traditional business has setup their online stores or partnered with e-commerce stores.

Experts believe that Pakistan’s ecommerce sale will generate $1 billion in revenues by 2020.

Keeping this growing trend in view the government has decided to impose a 0.5% tax. A Tax circular has been issued. According to this circular: “online marketplace under Section 2(38B) of the Income Tax Ordinance, 2001, which has been defined as an information technology platform run by an e-commerce entity over an electronic network that acts as a facilitator in transactions that occur between a buyer and a seller”

In other words all online stores will now be taxed at a certain rate. The new tax will be applicable from 1st July 2017.

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