From Our Correspondent
MULTAN: Pakistan’s salaried individuals contributed Rs144 billion in income tax during the first quarter (July–September) of fiscal year 2026–27, surpassing the collective contribution of the retail and real estate sectors by Rs90 billion.
Provisional data released by the Federal Board of Revenue (FBR) revealed that income tax collection from salaried employees rose by 10.2 percent (Rs13.4 billion) year-on-year, up from Rs130.6 billion collected in the same period last year. This surge comes despite tax relief measures introduced in the FY27 federal budget, which had reduced applicable slabs by up to three percentage points and abolished the 9 percent surcharge on higher-income brackets. Annual tax extracted from the salaried segment has steadily escalated from Rs391 billion prior to the 2024 IMF programme to Rs629 billion by June 2026.
In sharp contrast, tax receipts from the real estate sector plummeted by 38 percent to Rs35.2 billion during the quarter, reflecting a steep decline of Rs22 billion compared to the corresponding period last fiscal year. The drop followed budgetary concessions that halved advance tax rates on immovable property transactions—slashing property sale tax from 5.5 percent to a consolidated 2.75 percent, and purchase tax from 2.5 percent to 1.25 percent. Consequently, advance tax collected on property sales shrank 42 percent to Rs23 billion, while collections on purchases fell 31 percent to Rs12.2 billion.
Meanwhile, tax compliance from the trading sector remained largely stagnant. Wholesalers and retailers collectively paid Rs18.4 billion in withholding taxes during July–September, registering a nominal increase of only 1.3 percent (Rs244 million). Wholesalers’ tax payments contracted 10 percent to Rs6.2 billion, while retailers contributed Rs11.3 billion. Together, the retail and real estate sectors contributed roughly Rs54 billion—nearly three times less than the amount yielded by salaried employees alone.
Economic analysts point out that this widening disparity places an unfair burden on formal wage earners, who are simultaneously bearing the brunt of indirect taxation through an Rs80 per litre petroleum levy, a Rs5 per litre climate support levy, and surging electricity tariffs.
