Income tax collections from salaried class jump 21% to Rs85 billion in first two months of FY26

Pakistan’s salaried individuals have paid Rs85 billion in income tax during the first two months of the ongoing fiscal year 2025-26, 21% more than the Rs70 billion collected during the same period last year, The Express Tribune reported. 

Provisional figures from the Federal Board of Revenue (FBR) show that non-corporate employees paid Rs41.5 billion, up 26% from last year, while corporate sector employees contributed Rs20 billion, also 26% higher. 

Employees of provincial governments paid Rs10.5 billion, a 6% increase, and federal employees contributed Rs7.6 billion, up 8%.

The government’s new tax on wealthy pensioners, introduced in this year’s budget for pensions exceeding Rs10 million annually, yielded only Rs180 million over two months, suggesting annual collections may reach just over Rs1 billion.

Earlier, Finance Minister Muhammad Aurangzeb acknowledged that tax relief for the salaried class remained limited due to the government’s constrained fiscal space. The increase comes on top of last year’s already elevated base, when contributions rose by more than 50% because of higher income tax rates.

While the salaried class continues to see rising tax contributions, collection from traders remains limited. Several enforcement measures, including a ban on economic transactions by ineligible persons, were diluted or reversed. 

The real estate sector also faced higher taxes, with increased rates for non-filers and a new category for late filers. Withholding tax collections on plot sales rose 92% to Rs28 billion, while collections on plot purchases fell 12% to less than Rs13 billion.