Income tax collection in Pakistan has increased due to salaried workers. From July to January this fiscal year, the salaried sector paid a record Rs285 billion in taxes, up Rs100 billion from last year. The initial target was exceeded five months before the fiscal year ended due to this spike.
In the forthcoming budget, State Minister for Finance Ali Pervaiz Malik plans to shift part of the salaried class’s enormous tax burden to other sectors. An additional Rs75 billion tax burden was unwillingly introduced last year to comply with the IMF program, adding to this year’s significant collection increase.
Employees in corporate and non-business sectors have seen huge gains. Corporate employees’ income taxes jumped 50%, while non-corporate employees’ rose 41%. Provincial and federal government workers reported 96% and 63% tax increases. Despite these payments, rising living costs and a lack of social benefits have worried taxpayers.
While wholesalers and traders comply inconsistently, tax collection remains difficult. Discussions also showed how high beverage taxes have boosted informal production.
SIFC aspires to simplify corporate operations and encourage investment to alleviate economic issues. However, IMF conflicts have delayed measures including modifying the Pakistan Sovereign Wealth Fund Act. The administration recognizes that long-term budgetary stability requires export-led growth and stronger dispute-resolution processes.
With tax reforms and budget projections, the government must balance economic needs with taxpayer justice. Whether these efforts will help paid workers is unclear.
