Pakistani authorities introduced additional taxes on Netflix, directing banks to deduct a 13 percent provincial sales tax on advertisement services last year. 

Under fresh directives, commercial banks are now applying new taxes to video-on-demand streaming services. After fresh changes, Netflix subscribers in Pakistan need to pay 3pc Sales Tax on Services when paying subscription fees with debit or credit cards.

Furthermore, there is a 5pc Advance Tax on International Transactions for filers, while Card Transaction Charges set at 4 percent, other than Federal Excise Duty FDE. For non-filers, the advance tax on international transactions is different, with a rate of 10 percent for non-ATL individuals.

On behalf of Sindh Revenue Board, Commercial Banks will collect these additional taxes on Netflix. 

The development comes after Federal Board of Revenue (FBR) issued tax notice to Netflix to recover millions of rupees. The top tax authority sent notice to Netflix directing them to pay Rs200 million in tax on income to two previous years. 

Reports claimed that Netflix earned over Rs1 billion in Pakistan only in year 2021 as it has huge number subscribers in the South Asian country.