Salaried individuals in Pakistan continue to carry a significant portion of the country’s tax burden. According to provisional data released by the Federal Board of Revenue (FBR), salaried taxpayers contributed Rs266 billion in income tax during the first half of the current fiscal year (July–December). This accounts for nearly 10% of Pakistan’s total income tax collection for the period.
What is particularly notable is that the salaried class paid more than twice the amount contributed by the real estate sector during the same timeframe. Compared with last year, collections from salaried employees rose by Rs23 billion (around 9%), indicating a steady year-on-year increase in tax deductions from wages.
Sources further indicate that when book adjustments are included, total collections from the salaried segment had already crossed Rs300 billion by mid-year. These figures also exclude taxes deducted from certain contractual workers under Section 153-B, suggesting the actual contribution could be even higher.
Who Paid How Much?
- Non-corporate employees: Rs117 billion (up 14%)
- Corporate sector employees: Rs82 billion (up 13%)
- Federal government employees: Rs27 billion (up 8%)
- Provincial government employees: Rs39 billion (down 7%)
Why Is the Salaried Class Feeling the Pressure?
Experts note that salaried workers effectively pay about 38% of their gross income in taxes—far higher than many other sectors. Unlike business owners or traders, salaried individuals have limited room to underreport income because taxes are deducted directly at source.
By comparison, the real estate sector generated Rs126 billion in withholding taxes during the same period—less than half of what salaried employees paid. Within real estate, most revenue came from plot sales, while taxes on plot purchases declined following rate cuts in the budget.
Overall income tax collection in the first half reached Rs3.03 trillion, yet the FBR remains behind its annual target. Despite this shortfall, policymakers continue to depend heavily on the salaried segment, even considering stricter measures for non-filers within this already documented group.
Final Thoughts
The data highlights a clear trend: Pakistan’s salaried class is contributing more than its proportional share. While these taxpayers remain consistent and fully documented, several other sectors continue to be lightly taxed. Meaningful tax reform will require a broader and fairer distribution of the burden instead of placing repeated pressure on those who are already compliant.