Govt Likely to Expand Taxes on Digital Services

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As Pakistan moves towards Budget 2026-27, fresh tax ideas have been proposed to bring more sectors into the system. The Institute of Cost and Management Accountants of Pakistan (ICMA) has suggested taxes on digital services, online gaming and corporate advertising.
Digital Services Tax, which would apply to streaming platforms, mobile apps, online media, and gaming. As digital use rises in Pakistan, ICMA believes this sector can contribute more to the economy while also becoming more organized.
Another suggestion is to regulate and tax online and speculative gaming. Much of this activity currently operates through foreign platforms and remains undocumented. ICMA has proposed a licensing system where only approved operators can work, along with a 2% tax on their earnings. This is meant to generate revenue and protect users.
The institute has also recommended a tax on corporate advertising and brand promotion for companies earning over Rs 100 million annually. By using existing records from advertising agencies, the system can remain simple and transparent.
These proposals are part of a wider plan covering areas like climate taxes, transport, financial services, agriculture, and luxury goods. The overall aim is to create a more balanced tax system by including sectors that have mostly stayed outside the net.
It is still unclear which proposals will be accepted, but they show a shift towards finding new sources of revenue instead of relying on the same taxpayers again and again.
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