Salaried Class Pays More Income Tax Than Exporters, Retailers and Property Sector Combined

Pakistan’s salaried class has paid more income tax than three major segments of the economy combined, exporters, retailers and property buyers and sellers, during the first seven months of the current fiscal year, highlighting the widening tax burden on documented workers ahead of the upcoming IMF review.

Data compiled by the Federal Board of Revenue (FBR) show that retailers, exporters and participants in the property market collectively contributed Rs. 293 billion in income tax during July–January of FY26, while salaried individuals alone paid Rs. 315 billion in the same period.

The figures indicate that the salaried class paid Rs. 22 billion more than the three powerful and politically entrenched sectors combined. The development comes as Pakistan prepares for another IMF review mission, raising questions over whether the newly established Tax Policy Office at the Finance Ministry will succeed in convincing the Fund to ease the tax burden on salaried workers in the FY27 budget.

According to official data, exporters paid Rs. 50 billion in income tax in the first seven months of FY26, compared with Rs. 54 billion in the same period last year. In addition, exporters contributed Rs. 51 billion as a 1 percent advance tax, taking their total contribution to Rs. 101 billion during July–January, unchanged from last year.

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

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

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

On the purchase and transfer of property, the FBR collected Rs. 47 billion in July–January FY26, down from Rs. 66 billion in the same period last year. Tax rates on purchases were reduced to 1.5 percent for ATL persons on transactions up to Rs. 50 million, 2 percent for amounts up to Rs. 100 million, and 2.5 percent for transactions exceeding Rs. 100 million.

Meanwhile, salaried individuals in both the public and private sectors paid Rs. 315 billion in income tax during the first seven months of FY26, compared with Rs. 284 billion in the same period of the previous fiscal year, underscoring the growing reliance on payroll taxes to support government revenues.