Salaried workers pay more tax than retail, export, property sectors combined

Pakistan’s salaried workers paid more income tax than three major sectors of the economy combined during the first seven months of the current fiscal year, underscoring the growing tax burden on documented employees.

Data compiled by the Federal Board of Revenue (FBR) show that retailers, exporters and participants in the property market collectively contributed PKR 293 billion in income tax between July and January of fiscal year 2026. In comparison, salaried individuals alone paid PKR 315 billion during the same period.

The figures indicate that the salaried class paid PKR 22 billion more than the three influential sectors combined, highlighting the government’s increasing reliance on payroll taxes as it seeks to meet revenue targets under its IMF program.

The development comes as Pakistan prepares for another IMF review mission, with questions emerging over whether the newly established Tax Policy Office at the Finance Ministry will be able to persuade the Fund to ease the tax burden on salaried workers in the fiscal year 2027 budget.

Breakdown of collected tax

According to official data, exporters paid PKR 50 billion in income tax during the first seven months of FY26, compared with PKR 54 billion in the same period a year earlier. Exporters also contributed PKR 51 billion as a 1% advance tax, bringing their total payments to PKR 101 billion during July-January, unchanged from last year.

Retailers, who operate nearly three million outlets nationwide, paid PKR 15 billion as advance tax under Section 236G on sales to distributors, dealers and wholesalers, up from PKR 13.5 billion a year earlier. Under Section 236H, retailers paid an additional PKR 25 billion, compared with PKR 19 billion in the same period last year.

The FBR collected PKR 105 billion on the sale and transfer of immovable property under Section 236C during the first seven months of FY26, compared with PKR 65 billion in the corresponding period of FY25.

Under the FY26 budget, property transactions up to PKR 50 million are taxed at 4.5% for individuals listed on the Active Taxpayer List. Transactions exceeding PKR 50 million but not more than PKR 100 million are taxed at 5%, while those above PKR 100 million face a 5.5% rate. Non-listed taxpayers pay 11.5%, while late filers are charged between 7.5% and 9.5%, depending on the size of the transaction.

On property purchases and transfers, the FBR collected PKR 47 billion during July-January FY26, down from PKR 66 billion in the same period last year. Tax rates on purchases were reduced to 1.5% for listed taxpayers on transactions up to PKR 50 million, 2% for amounts up to PKR 100 million, and 2.5% for transactions exceeding PKR 100 million.

Meanwhile, salaried individuals in both the public and private sectors paid PKR 315 billion in income tax during the first seven months of FY26, compared with PKR 284 billion in the same period of the previous fiscal year, reinforcing concerns about the widening tax burden on formal sector employees as the government works to shore up revenues.