ISLAMABAD: The Federal Board of Revenue (FBR) has reported a significant 30% decline in tax collection from electricity consumption in Karachi during the first five months (July–November) of the fiscal year 2025-26.
According to FBR officials, advance income tax collected from electricity bills issued by K-Electric fell to Rs10.30 billion, down from Rs14.70 billion during the same period last year.
Officials attribute the decline in tax revenues primarily to slower industrial activity and a decrease in electricity tariffs. Under Section 235 of the Income Tax Ordinance, 2001, the FBR collects advance income tax from industrial, commercial, and residential consumers at prescribed rates. The slowdown in industrial output and reduced electricity charges have directly impacted the revenue collected from this source.
Despite the overall decline, the FBR recorded a 20% increase in tax collection for November 2025, which rose to Rs2.62 billion compared to Rs2.20 billion in November of the previous fiscal year. Tax authorities are optimistic that this upward trend may continue as economic and commercial activities gain momentum in the coming months.
The FBR’s monitoring of electricity-based tax collection serves as a key indicator of economic performance, particularly in industrial hubs like Karachi. Analysts suggest that improving industrial output and stable electricity pricing could help restore and potentially surpass previous years’ tax revenue levels. The authority continues to emphasize compliance and timely payment to bolster federal revenue streams.
