Pakistan’s salaried class pays 352% more tax than traders, exporters combined: study

A study on Pakistan’s taxation system has found that the salaried class is paying significantly higher taxes than several other economic groups, contributing 3.5 times more than exporters, retailers, wholesalers and distributors combined, The News reported. 

The findings were presented during a roundtable organised by Germany’s Friedrich Ebert Stiftung (FES) for the launch of the study titled “State, Society and Progressive Taxation in Pakistan” authored by Dr Sajid Amin Javed.

According to the report, the salaried class paid Rs391 billion in income tax in 2024, compared with Rs276 billion in 2023, reflecting a 41.66 percent increase within a year.

The study noted that the total tax contribution of salaried workers was 352 percent higher than the combined taxes paid by exporters, retailers, wholesalers and distributors.

Researchers described the trend as a structural shift in the country’s taxation pattern rather than a temporary increase, noting that tax collection from the salaried segment increased by 412.6 percent between 2019 and 2024.

The report said the pattern indicates a growing reliance on the salaried class for revenue collection while other sectors continue to contribute comparatively less.

Over the past five years from 2020 to 2025, salaried employees paid Rs1,144.94 billion in taxes. In comparison, retailers contributed around Rs16.54 billion, while wholesalers and distributors together paid Rs35.23 billion during the same period.

The study argued that the growing reliance on salaried workers for tax revenue has created a perception of improvement in direct taxation, while masking deeper structural imbalances in the broader tax system.

The findings were discussed at a time when the International Monetary Fund is conducting the third review of Pakistan’s $7 billion Extended Fund Facility programme.