The Senate Standing Committee on Finance examined the Finance Bill 2025 on Wednesday and proposed a zero-rated tax on income of up to Rs1.2 million and turned down a suggestion for imposing tax on people with small online businesses.
At a meeting, presided over by its chairman Saleem Mandviwala, the committee okayed the proposal to tax online academies and teachers’ income but rejected the imposition of tax on the Islamabad Club’s income.
Federal Board of Revenue (FBR) officials briefed the meeting that teachers were offering online digital education services and earning Rs20-30 million.
They said that a new clause had been added in the Finance Bill to charge tax on those who are doing business through e-commerce using online platforms.
All those offering services through the internet and electronic networks will be impacted, FBR officials stated.
They further revealed that the tax would also be levied on music, audio and video streaming websites, cloud facilities, online application providers for software, telemedicine and e-learning services.
The tax would also be levied on online banking services, design of architecture services, research and consultancy reports, accounting services and other online facilities in the shape of electronic files, the FBR officials said.
The proposal to tax people engaged in small online businesses was turned down by the committee.
The chairman of the FBR said that persons earning an annual income of 1.2 million will pay Rs12,500 as taxes.
Senator Shibli Faraz, who was on the committee, stated that there should not be any tax imposed on income between Rs600,000 and Rs1.2 million.
FBR Chairman Rashid Langrial informed the committee that it was decided to impose tax on entertainment clubs, including Islamabad Club. However, the move was opposed by the chair of the committee.
