In a striking display of imbalance, Pakistan’s salaried class has coughed up a record-breaking Rs. 391 billion in income tax during the first nine months of FY2024 — accounting for a hefty 10% of the country’s total income tax haul. This surpasses the Rs. 368 billion paid by the same group in the entire previous year, reflecting a staggering 56% year-on-year increase.
While the salaried segment is squeezed tighter, other sectors remain largely untouched. Traders contributed a meager Rs. 26 billion, and wholesalers and distributors added only Rs. 17.5 billion — nearly half of them not even formally registered. For every Rs. 10 extracted from salaried workers, the trader community pitched in barely Rs. 0.60.
Despite initially targeting an extra Rs. 75 billion from salaried employees, the government has already extracted over Rs. 140 billion — with a full quarter still to go. These employees are taxed on their gross income, without deductions for basic living costs, and the top income slab now faces an effective rate of 38.5%.
Breakdowns reveal non-corporate employees paid Rs. 166 billion (a 43% rise), corporate workers Rs. 117 billion (up 52%), provincial government employees Rs. 69 billion (a 103% leap), and federal employees Rs. 39 billion (up 65%).
Meanwhile, the Federal Board of Revenue (FBR) is grappling with a massive Rs. 714 billion shortfall from its revised Rs. 12.3 trillion target — with final revenue projections hovering around Rs. 11.7 trillion, despite implementing Rs. 1.3 trillion in new taxes. Sluggish economic growth and easing inflation have further dented overall revenue performance.
