ISLAMABAD: Salaried individuals contributed Rs266 billion in income tax during the first half of the current fiscal year, accounting for nearly one-tenth of the country’s total income tax collection, according to provisional figures released by the Federal Board of Revenue (FBR).
Tax payments by salaried persons in both the public and private sectors were more than double those made by the real estate sector during the July–December period. The Rs266 billion collection marks an increase of Rs23 billion, or 9%, compared to the same period last year, when salaried taxpayers paid Rs243 billion, excluding book adjustments.
Sources said that after accounting for book adjustments, collections from salaried individuals had already crossed Rs300 billion by the end of the first half of the fiscal year. The figures also exclude taxes paid by certain contractual employees under Section 153-B of the Income Tax Ordinance.
Despite this growing contribution, the salaried class continues to bear a disproportionate tax burden. Analysts note that salaried individuals pay around 38% of their gross income in taxes—significantly higher than regional averages and far above the contributions made by sectors such as real estate and retail.
Of the total, non-corporate employees paid Rs117 billion, reflecting a 14% increase year-on-year, while corporate sector employees contributed Rs82 billion, up 13%. Provincial government employees paid Rs39 billion, down 7% from last year, whereas federal government employees contributed Rs27 billion, an 8% increase.
Overall income tax collection during the first half of the fiscal year stood at Rs3.03 trillion. The FBR, however, struggled to meet its downward-revised annual target of Rs6.5 trillion, recording less than 10% growth—about half the pace required to achieve the full-year goal.
Meanwhile, tax collection from the real estate sector remained relatively modest. The government collected Rs126 billion in withholding taxes from real estate transactions during the period, a 17% increase year-on-year. Withholding tax on plot sales rose sharply to Rs87 billion, while collections on plot purchases declined 29% to Rs39 billion following a reduction in purchase-side tax rates in the budget.
The government has also contemplated penalising salaried individuals who fail to file income tax returns, even as efforts to broaden the tax base beyond already documented sectors continue to face resistance and policy reversals.
