Prices of goods listed on Temu, a popular online marketplace platform, have witnessed a stark increase. Netizens from Paksitan have outlined how prices have skyrocketed, with some goods reportedly being priced three to four times their previous price.

The timing of the price hike coincides with the start of fiscal year (FY) 2025-26. This has caused many analysts to believe that new taxes listed in the  budget for FY 2025-26 are responsible for the rise in price.

Users on social media platform Reddit expressed great displeasure over rising prices. One user said:  “This is so insane. I checked Ali Express and they have done that too.” Other users tried to rationalise the increase in prices, speculating that Temu’s servers were likely infected by a bug and that prices would soon be revised downwards.

Some netizens proposed the theory that the implementation of the general sales tax (GST) on the purchase of goods from online stores was causing the abnormal hike in prices. However, it is unlikely that the levying of the 18 percent GST on online goods could cause prices to “quadruple”, which netizens claim is the case.

Reports from June 2025 suggest that Islamabad imposed a broad range of taxes on e-commerce platforms, digital service providers, and courier companies in an effort to generate Rs64 billion during FY 2025-26. The new policy applied to both domestic and foreign enterprises operating in Pakistan's digital economy.

However, according to one unverified report, the rise in prices might have been caused by Pakistani customs authorities leading a crackdown against “heavily discounted shipping services”.  These services include Cainiao and AliExpress Standard Shipping.

The report suggests that China based online marketplaces heavily rely on the aforementioned shipping services to ship their goods to Pakistani customers. However, with a crackdown reportedly being carried out against the shipping services, these goods are likely to witness a surge in prices as sellers will have to pass on the higher transportation costs onto customers to protect their profit margins.

The rise in prices spells bad news for Pakistan, as Temu provided goods to consumers at unbeatable prices with minimal or no shipping fees. The price hike has largely eroded the competitive edge Temu had on domestic manufacturers which may cause many Pakistanis to revert back to purhcasing local goods.

It merits a mention that lawmakers and relevant authorities have not yet provided a clarification for the sudden spike in the prices of goods on e-commerce platforms.