A modest set of aspirations has long defined the Pakistani urban white-collar class. This middle-class dream includes owning a reliable car, a comfortable home in a decent suburb, quality education for their children, and enough discretionary income for domestic help, dining out, nice outfits, home improvements, or occasional trips up north. Many hope to save enough to perform Hajj and give their children a memorable wedding.
This pursuit is framed by the enduring ethos of “Parho gay, likho gay, bano gay nawab.” However, this once-attainable stability is increasingly out of reach. This class, once the bedrock of societal progress and upward mobility, is finding it increasingly difficult to make ends meet, acquire assets, and retire with dignity.
While defining the middle class is challenging, several benchmarks exist in the context of developing countries. Sandwiched between the rich and the poor, they are usually in the third and fourth quintile of the population. The World Bank’s gross national income-based definition estimates a monthly income of $300-$1,140 for this group, while Credit Suisse’s wealth report considers adults with at least $15,000 in wealth to be middle-class. According to the Federal Board of Revenue (FBR)’s income tax exemption limit, a salary of Rs50,000 per month unofficially marks the boundary of being middle-class, encompassing a significant portion of Pakistanis.
With no resources allocated to them in budgets amidst outrageous taxes, middle-class households are just one mishap away from financial ruin. They have been quietly struggling for years, shouldering the burden of tax breaks, subsidies, and concessions for the privileged classes—whether rich or poor—while being left to fend for themselves.
Rising inflation, stagnant wages, and extractive taxes are eroding their purchasing power and savings. There are no resources left for them in budgets and plans and no social safety net in the event of death, disability, illness, or unemployment, leaving these households one mishap away from financial ruin.
The state’s neglect has shifted even basic entitlements such as education, healthcare, affordable energy, safety, and security into personal burdens, forcing individuals to assume responsibility for their own well-being and that of their family and community.
The contempt of those in power towards the third and fourth quintiles is staggering and undisguised. It makes a certain French queen look benevolent by comparison. The latest budget clearly indicates their priorities, perpetuating a systemic cycle of exploitation while the privileged remain insulated and indulged.
Where direct taxes are concerned, the FBR seems to focus on salaried individuals. Skilled professionals and domain experts who have spent decades reaching a level of professional attainment now effectively work for free for four months a year, with an effective tax rate of 33% if their income exceeds Rs1 million a month. Unlike companies, which can deduct expenses and reduce their tax liability, these individuals pay taxes on their gross income, making their tax burden far higher.
The more dependents they have, the faster their earnings dissipate, leaving these “high-income earners” remarkably vulnerable when ageing parents, struggling siblings, and children are added to the equation. This doesn’t end here, as they are also hit with a barrage of federal and provincial taxes on every purchase, every service, every indulgence, chipping away all day, every day, until nothing is left to put towards their future.
Amidst an otherwise mind-numbing display of incompetence, successive governments have achieved a rare feat—a shared legacy of destruction. With striking synchronicity and coherence, they have created a perverse incentive structure that discourages hard work, productivity, and excellence.
The consequences are plain to see. Capital is being reallocated to sectors with favorable tax treatment, leading to the deindustrialization of the economy, the phasing out of tax-compliant businesses, dismal growth prospects, and a relentless assault on the middle class.
The situation is eerily reminiscent of ancient galley ships, where rows of slaves crammed on benches in the lower deck, unheard and unseen, rowed ceaselessly, while another cohort continued with the merry-making on the upper deck.
The average Pakistani working in the documented sector is similarly trapped in an escalating cycle of taxation and forced to bear the burden of the entire economy on their shoulders, while freebies continue for landowners, bureaucrats, servicemen, and politicians, funded by the very taxes extorted from the productive masses.
The fabric of upward social mobility is tearing apart, leaving the most productive members of society exposed to disenfranchisement. Financial suffocation and lack of representation in economic decisions are forcing the best and the brightest to consider a painful exit: abandoning their homeland for more sympathetic shores where they are valued and respected.
The middle class, ultimately, lies battered and bruised as a casualty of a system that prioritizes privilege over productivity and greed over growth.
