ISLAMABAD: The Federal Board of Revenue (FBR) has collected over Rs518 billion in salary tax during the first eleven months (July–May) of fiscal year 2025-26 (11MFY26), reflecting a decline of around 6 per cent on a year-on-year basis.
According to official sources, salary tax collection stood at Rs518.48 billion during the period compared to approximately Rs555 billion in the corresponding months of the previous fiscal year.
The decline comes at a time when the taxation of salaried individuals remains a contentious issue in Pakistan, with repeated calls from various quarters for a reduction in income tax rates to provide relief amid rising inflation and cost-of-living pressures.
However, the latest trends suggest that salaried taxpayers may not receive significant relief in the upcoming Budget 2026-27, as revenue pressures continue to shape fiscal policy decisions.
Despite the recent slowdown, FBR had previously reported stronger growth in salary tax collections. The total stood at around Rs605.59 billion in fiscal year 2024-25, reflecting a notable upward trajectory over the past few years.
FBR data shows a sharp increase in salary tax contribution over time, rising from approximately Rs152 billion in fiscal year 2020-21 to Rs196.25 billion, Rs276 billion, and Rs391 billion in subsequent years, highlighting expanding compliance and rising taxable income within the salaried segment.
Tax analysts suggest that the fluctuation may reflect multiple factors, including adjustments in income levels, employment trends, and broader economic conditions affecting disposable incomes.
