Who is really funding Pakistan’s tax system – salaried class or business elites?

Budget 2025 Withholding Tax Increased To 0 8pc On Cash Withdrawals By Non Filers

ISLAMABAD – In a revealing breakdown of tax contributions for the fiscal year 2024-25, Pakistan’s silent majority — the salaried class — has emerged as the largest contributor to direct taxes, paying more than double the combined total paid by exporters and traders.

Data shared by the Federal Board of Revenue (FBR) showed salaried individuals paid a record Rs545 billion in income tax during the last financial year. In contrast, exporters — who earn in foreign currency — contributed only Rs180 billion, while traders paid a mere Rs62 billion under sections 236G and 236H of the Income Tax Ordinance.

This means the salaried class contributed 300% more tax than exporters and 500% more than traders — both of whom often enjoy tax concessions and have strong political affiliations.

Despite their relatively lower earnings, the salaried class has consistently borne the highest tax burden through automatic salary deductions.

FBR officials confirmed that the total income tax collected from employees exceeded the combined tax payments of exporters and traders by more than twofold, highlighting a stark imbalance in Pakistan’s tax structure.

The contribution from the salaried class also marked a significant rise from the previous year. In fiscal year 2023-24, employees paid Rs367 billion, which increased by Rs178 billion to Rs545 billion in 2024-25 — a 49% year-on-year jump.

FBR stated that tougher enforcement measures are being rolled out to bring non-filing and under-declaring traders into the tax net, promising that “the results of strict actions will become evident soon.”

This growing disparity has raised pressing concerns about tax justice and whether Pakistan’s taxation policies unfairly burden law-abiding employees while allowing business elites to avoid their fair share.

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