ISLAMABAD: Pakistani content creators and influencers called on the Federal Board of Revenue to review the withholding tax on social media earnings. Creators want a more balanced framework that recognizes their production costs and supports digital entrepreneurship.
FBR introduced the withholding tax under Section 154B of the Income Tax Ordinance 2001. Under the Finance Bill 2026-27, banks now deduct tax when creators receive international payments from YouTube, Facebook, Instagram, and TikTok. Filers pay 5% while non-filers face a 10% rate. FBR also set a minimum benchmark of Rs195 (approximately $0.70) per 1,000 YouTube views through SRO 642(I)/2026 and SRO 1641(I)/2026.
Creators argue the current rules ignore their actual costs. FBR currently allows only a 30% expense ceiling against total revenue. However, creators say production equipment, editing software, internet costs, and travel expenses often exceed that cap. As a result, they pay tax on income they never actually kept.
The earnings data supports their case. Nano creators with under 10,000 followers earn between Rs. 500 and Rs25,000 per post. Micro creators with up to 100,000 followers make Rs. 5,000 to Rs. 150,000. On YouTube specifically, 100,000 views yield Rs. 5,000 to 20,000. Mid-tier creators combine multiple platforms to earn Rs. 50,000 to 400,000 monthly. Meanwhile, salaried creator roles in Karachi pay a median of Rs. 60,000 per month.
The demands come as Pakistan’s IT exports reached a record $4.6 billion. Creators contribute to that figure through platform ad revenue classified as IT service exports. A fairer tax framework could encourage more creators to formalize their earnings rather than avoid the banking system entirely.
