Salaried Class Pays Rs633bn In Income Tax, Emerges As Pakistan's Largest Contributor

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Salaried class pays Rs633bn in income tax, emerges as Pakistan's largest contributor

The FBR provisionally collected Rs13.01 trillion in taxes during the fiscal year that ended on June 30, 2026

ISLAMABAD: (UrduPoint/Pakistan Point News-July 4th, 2026) Pakistan's salaried class contributed Rs633 billion in income tax during the fiscal year 2025-26, exceeding the combined income tax paid by exporters, the real estate sector and retailers, according to provisional figures compiled by the Federal board of Revenue (FBR).

The FBR provisionally collected Rs13.01 trillion in taxes during the fiscal year that ended on June 30, 2026. Among all taxpayer categories, salaried individuals remained one of the largest contributors, with taxes deducted directly at source and deposited into the national exchequer.

According to the provisional data, income tax paid by salaried employees increased to Rs633 billion in FY2025-26 from Rs585 billion in the previous fiscal year, reflecting a rise of Rs48 billion.

Exporters contributed Rs174 billion in income tax during the year, compared with Rs176 billion in FY2024-25, indicating little change in their overall tax contribution.

The FBR also collected significant revenue from the real estate sector through withholding taxes on property transactions. Under Section 236-C, which applies to property sellers, collections rose to Rs191 billion from Rs118 billion a year earlier. However, revenue collected under Section 236-K from property buyers declined to Rs87 billion, compared with Rs120 billion in the previous fiscal year.

Retailers contributed around Rs70 billion in withholding taxes under Sections 236-G and 236-H, up from Rs62 billion in FY2024-25. Collections under Section 236-G increased to Rs25 billion, while revenue under Section 236-H reached Rs45 billion during the fiscal year.

For the current fiscal year, the government has set the FBR's tax collection target at Rs15.264 trillion. Tax relief measures have been announced for salaried individuals, while changes have also been introduced for exporters and the real estate sector in an effort to encourage economic activity and broaden the tax base.

The FBR is also implementing a new operating model within the Inland Revenue Service aimed at reducing direct interaction between taxpayers and tax officials through the increased use of technology and artificial intelligence. Officials believe the reforms will improve transparency, enhance tax compliance and support higher revenue collection during the ongoing fiscal year.

Abdullah Hussain

Abdullah Hussain is a staff member who writes on politics, human rights, social issues and climate change.