#2025budget

What’s the real cost of ignoring these details?

Despite reassurances, the online business community remains uneasy. At a press event in Karachi, representatives from the Chainstore Association and the Pakistan E-Commerce Association warned that the proposed tax structure which includes multiple withholding rates, complex registration rules, and harsh penalties could disrupt over 100,000 small vendors. For many, especially informal sellers and micro-entrepreneurs using platforms like Instagram, WhatsApp, and cash-on-delivery services, the compliance cost could outweigh the benefits. Industry leaders urged the government to adopt a phased implementation strategy and consult with platforms, logistics providers, and payment gateways to build a streamlined, consensus-driven framework. A Balancing Act for Pakistan’s Digital Future While the Senate Finance Committee rejected blanket taxation of individuals earning PKR 1.2 million and recommended zero-rated tax for small sellers, both houses of Parliament appear united in bringing Pakistan’s digital economy into the formal tax net without crushing its most vulnerable players. The road ahead requires balancing two objectives: meeting ambitious revenue targets while ensuring that Pakistan’s booming e-commerce ecosystem led by women, students, and small entrepreneurs isn’t strangled by red tape. Startup.pk Takeaway: As Pakistan formalizes its digital economy, inclusivity and gradual rollout will be key. Startups and online sellers should stay informed, advocate for smart policy, and prepare for an evolving regulatory landscape. FAQ 1. Who will be taxed under the proposed e-commerce tax policy in the Finance Bill 2025–26? Who will be taxed under the proposed e-commerce tax policy in the Finance Bill 2025–26? Online businesses and digital service providers earning over PKR 5 million annually will be subject to taxation. However, individuals earning below this threshold (or PKR 1.2 million for small sellers) will remain exempt, even if registered. 2. Will small, home-based online sellers be affected by this new tax? Will small, home-based online sellers be affected by this new tax? According to FBR officials, sellers earning below the income threshold will not be taxed. However, the requirement for registration and potential compliance obligations may still apply, which has raised concerns among micro-entrepreneurs, especially women. 3. How is the government planning to implement the new tax regime for digital businesses? How is the government planning to implement the new tax regime for digital businesses? The government plans to implement a Sales Tax Withholding regime ranging from 0.25% to 2%, depending on transaction value, and apply income tax on digital earnings. Industry representatives are urging a phased rollout and more stakeholder consultations. Read the full article

India’s budget has evolved through liberalization, infrastructure expansion, and digital transformation. What’s next for 2025?

The administration of President Bola Tinubu has come under pressure from the House of Representatives for taking too long to present the National Assembly with the 2025 budget plan. The lawmakers contend that the National Assembly is being denied the time it needs to carry out its duties as a result of the Executive's disregard for Section 11(1)(b) of the Fiscal Responsibility Act 2007. The legislature has demanded that the Executive follow Section 11(1)(b) of the Act, and it has directed the National Planning and Economic Development, Appropriations, and Finance committees to make sure that compliance is achieved in a fortnight. The Fiscal Responsibility Act of 2007 provides several advantages, including responsible resource management, long-term macroeconomic stability, accountability, and transparency in fiscal operations. Clement Jimbo filed a motion of urgent public interest, which resulted in the House's decision. Jimbo also emphasized that the Medium-Term Economic Forecast (MTEF) for the following three fiscal years must be prepared and presented by the Federal Government no later than four months prior to the start of the subsequent fiscal year. The House of Representatives voted to "Urge the Executive to comply with section 11(1)(b) and submit the 2025 Budget Proposal without further delays." Read the full article