Sales Tax on Online Orders in Pakistan (2026): The 2% Courier and Bank Deduction Explained
Your bank or courier now deducts 2% on online orders. Section 3(7A) makes it final for small sellers. What it means for your FBR digital invoice.
What this guide tells you, in plain words
You sell online. The customer pays by card or wallet, or the rider collects cash at the door. Then you notice the money reaching you is short. Someone took a cut for tax. This page explains who took it and what you still have to do.
The first fact. Serial 8 of the Eleventh Schedule to the Sales Tax Act 1990 sets the rate at 2 percent of gross value of supplies. The Finance Act 2025 put it there. The people who deduct it are payment intermediaries (banks, gateways and wallets that move the money) and couriers.
The second fact. Section 3(3)(c) says the duty to collect and pay that tax is theirs, not yours. Paid digitally, the payment intermediary does it. Paid cash on delivery, the courier does it.
The third fact saves small sellers real money. Section 3(7A), also added by the Finance Act 2025, calls that deduction the final discharge of tax liability for two groups only. Those are a cottage industry under section 2(5AB), and retailers other than Tier-1 retailers. For everyone else the 2 percent is just money paid in early.
Who takes the 2 percent: the bank or the courier
The Act names both, and it tells them apart by how the customer paid.
Paid online by card, bank transfer, wallet or gateway? Then the payment intermediary deducts. Section 2(20A) defines it as a banking company, a financial institution, a licensed exchange company or a payment gateway that moves funds between parties without keeping the money itself.
Paid cash to the rider? Then the courier deducts. Section 2(5ABA) defines a courier as any entity that delivers goods and collects cash on behalf of a seller, including logistic and ride-hailing services. So a bike-delivery app counts too.
The sale itself has to be an online one. Section 2(9C) defines e-commerce as buying or selling goods over computer networks, through websites, mobile apps or an online marketplace. Section 2(18A) calls a marketplace an interface that connects many buyers to many sellers for a fee, whether or not it owns the goods.
One line matters for shops that also sell in person. This rule covers digitally ordered goods. A walk-in counter sale in your own shop is not touched by it.
The 2 percent is on the sale price, not on the tax
Read the Schedule wording slowly: 2 percent of gross value of supplies. Gross value means the sale price. It does not mean 2 percent of the sales tax on the sale.
A plain example. You sell a Rs 10,000 order online. The deduction is Rs 200, taken before the money reaches you.
Whether that Rs 200 is the end of the story depends on who you are.
Cottage industry, or a retailer who is not a Tier-1 retailer? Section 3(7A) treats the Rs 200 as final discharge of tax liability on that supply. The sales tax on that sale is settled.
Anything else, such as a company, a Tier-1 retailer, a wholesaler, a distributor or a manufacturer? Then it is not final. You still charge the normal rate, file your monthly return, and count the Rs 200 as tax already deposited for you.
So the first question is not about the courier. It is about which group you are in. 'Who Is a Tier-1 Retailer in Pakistan in 2026? The Rs 200 Million Rule, the Card-Machine Test FBR Removed, and What It Means for Digital Invoicing' settles the retailer side, and 'Who Is Exempt from FBR Digital Invoicing? Cottage Industry, Unregistered Sellers & Services (2026)' sets out the four cottage industry conditions.
When the 2 percent is not deducted
The Eleventh Schedule carries a list of goods and supplies after its table, and withholding does not apply to them. Some of that list matters to online sellers.
Clause (viii) is the big one. A supply by an Active Taxpayer to another registered person is outside the withholding, except for the serials the clause names: 5, 7, 9, 10, 11, 12 and 13. Serial 8, the courier and payment intermediary row, is not on that list. Read plainly, a business-to-business online sale between two registered active taxpayers does not carry the 2 percent. A sale to an ordinary consumer does.
The rest of the list rules out whole product lines: electrical energy, natural gas, named petroleum products, vegetable ghee and cooking oil, telecommunication services, goods in the Third Schedule, and supplies by importers who already paid value addition tax at import.
Third Schedule goods matter if you sell branded packaged items online. Those pay sales tax on the printed retail price instead.
One honest warning. This schedule has been changed by more than one Finance Act, and serial 8 itself was rewritten in 2025. Check the current version before you rely on it.
You still have to issue an FBR digital invoice
This is the mistake to avoid. The 2 percent answers who pays the tax. It does not remove your duty to invoice.
Section 14(1A) says every person selling digitally ordered goods through an online marketplace, website or software application must apply for registration. Non-residents are included. Two groups are left out: a cottage industry, and retailers who pay sales tax through their electricity bills under section 3(9).
Section 14(1B) puts the platform on the hook. A marketplace or courier must not let anyone use its service for e-commerce unless that person holds an NTN (National Tax Number), and sales tax registration too where 14(1A) applies. That is why marketplaces started asking sellers for tax numbers.
Section 26 closes the circle. Every online marketplace, payment intermediary and courier files a monthly statement showing supplier-wise amounts paid and tax due. So FBR sees your online sales from their side, seller by seller. Your own invoices need to agree with that picture.
If you are registered for sales tax, every sale still goes to FBR first and comes back with an IRN (Invoice Reference Number, the unique number FBR gives each accepted invoice) and a QR code. 'FBR Digital Invoicing for Online Sellers & E-Commerce in Pakistan (2026)' covers the seller side, and 'FBR Digital Invoicing for Courier, Cargo & Logistics Companies (2026)' covers the delivery side. Not registered yet? Start with 'Sales Tax Registration (STRN) in Pakistan: The Step Before FBR Digital Invoicing (2026)'. Withholding on offline sales works differently, and 'Selling to a Government Department: FBR Digital Invoicing, Sales Tax Withholding and FTN Buyers (2026)' explains that route.
Digi Invoice posts each invoice to FBR and keeps the IRN with it, so your records can be matched against the statements your marketplace and courier file. Create a free account and post a test invoice in the sandbox (FBR's free practice system where test invoices do not count as real) first.
Difficult words in this guide
Payment intermediary — a bank, financial institution, licensed exchange company or payment gateway that moves the money between buyer and seller without keeping it.
Courier — under section 2(5ABA), any entity that delivers goods and collects cash for a seller, including logistic and ride-hailing services.
Digitally ordered goods — goods ordered through a website, a mobile app or an online marketplace, rather than over a counter.
Final discharge of tax liability — the tax on that sale is fully settled by the deduction. Nothing further is payable on it.
Gross value of supplies — the sale price of the goods. The 2 percent is worked out on this, not on the tax amount.
Eleventh Schedule — the table in the Sales Tax Act 1990 that lists who withholds tax, from whom, and at what rate.