Online buyers in Pakistan are complaining about the exponential increase in the price of products on online market sites such as Temu and AliExpress. However, experts believe the sharp surge in Pakistan on the online marketplaces is directly linked to their recently passed budget.
Internet users in Pakistan have pointed out in recent days that Pakistan has soared dramatically on these platforms with some items reportedly costing 3-4 times more than before. However, the 3-4 times price increase is not due to recently introduced taxes alone.
The Government of Pakistan has introduced a Digital Presence Proceeds Tax Act under which a 5% tax has been imposed on goods sold in Pakistan from abroad. Moreover, in addition to the 5% tax, these online platforms of shopping stores would also have to pay 18% sales tax, just like other businesses in Pakistan do.
To put it into perspective, a manufacturer in Pakistan will pay 18% sales tax along with 35% income tax if he sells a product. However, earlier foreign companies like Taimu and AliExpress were selling products in Pakistan without paying any taxes. This budget will tend to change this trend.
Read more: China says no ambition to build South Pacific military base
However, the induced taxes in the budget do not directly correspond to the 300% increase in prices of products listed on the websites. It is more likely that online marketplaces like Temu have deliberately increased the prices as a precaution to avoid any unspecified taxes or duties. However, there are chances that prices will come down in the future once there is more clarity on these taxes.
Pakistani online shoppers have been anxious as most of them have been buying products for months from these online marketplaces, especially Temu. There has been a lot of chatter on the weekend on Pakistan’s social media platforms regarding the price increase. These shoppers have expressed displeasure at this sudden increase in prices. Many are demanding that the government return the taxes, as they were able to buy cheap and quality products from Temu before.