ISLAMABAD: The Federal Board of Revenue (FBR) has issued a new Sales Tax Notification, S.R.O. 1429 (I)/2025, introducing a mandatory withholding tax obligation for online marketplaces, payment intermediaries, and courier services on digitally ordered taxable goods. This significant regulatory change aims to enhance sales tax collection and formalize transactions within the burgeoning e-commerce sector.
The new rules, inserted as a new Chapter XIV-E into the Sales Tax Rules, 2006, apply to all taxable goods ordered through online marketplaces, websites, or similar applications. The obligation extends to payment intermediaries (for online payments) and couriers (for Cash on Delivery, or CoD, payments).
Under the new regulations, these entities will be responsible for deducting sales tax as specified in the Eleventh Schedule of the Sales Tax Act, 1990, before settling the remaining amount with the supplier or vendor. This makes them withholding agents.
The SRO outlines specific responsibilities for each type of withholding agent:
Payment intermediaries must deduct sales tax and file a monthly electronic statement (STR -35) by the 10th of the following month.
Couriers must do the same, but they will use a different electronic form STR -36.
Online marketplaces in Pakistan are required to file a monthly statement STR -34
by the 10th of the following month, detailing supplier-wise orders and goods delivered. If an online marketplace also provides courier services, it must file both STR -34 and STR -36 .
In addition, both payment intermediaries and couriers are required to issue a certificate to the supplier, detailing the amount of sales tax deducted.
This certificate must include the supplier’s name, registration number, a description of the goods, and the tax amount withheld. This new framework is expected to improve traceability and ensure a more structured sales tax collection from the e-commerce supply chain.
