Islamabad, Apr 29, 2025: In the first nine months of FY2024 (July to March), Pakistan’s salaried employees contributed a historic Rs. 391 billion in income tax, accounting for nearly 10 percent of the nation’s total income tax revenues.
This impressive figure highlights the increasing tax burden shouldered by salary earners across the country.
Comparing this year’s performance to the last fiscal year, the jump is even more striking.
Throughout the entire previous year, the salaried segment had contributed Rs. 368 billion.
This year, however, they surpassed that amount in just three quarters, reflecting a sharp 56 percent surge compared to the same period last year.
The data points to growing pressure on the formal sector, even as other sectors remain largely under-taxed.
On the flip side, traders — who form a significant portion of Pakistan’s economic activity — contributed a mere Rs. 26 billion in taxes during the same period.
Meanwhile, wholesalers and distributors collectively paid around Rs. 17.5 billion.
Shockingly, almost half of the contributors from these sectors are not even officially registered with tax authorities, indicating widespread non-compliance and weak enforcement mechanisms.
The disparity between salaried workers and traders becomes even clearer when looking at the numbers: for every Rs. 10 collected from an employee’s paycheck, the trading community contributed only Rs. 0.60.
This huge gap underscores the imbalance in Pakistan’s tax structure, where individuals with fixed incomes are taxed heavily while others manage to avoid paying their fair share.
This situation calls for urgent tax reforms to broaden the tax base, bring informal sectors into the net, and relieve the pressure on the salaried class.
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If ignored, this widening gap could further discourage compliance among honest taxpayers and deepen mistrust in the system.
Ultimately, Pakistan’s road to sustainable growth depends on fair and equitable tax collection.
It’s time for policymakers to address these glaring discrepancies and ensure that all sectors contribute justly to the national exchequer.
