The salaried class in Pakistan contributed a record Rs. 545 billion in income tax during the fiscal year 2024–25 (FY25), more than double the combined total of Rs. 242 billion paid by exporters and retailers, according to official data released by the Federal Board of Revenue (FBR).

Exporters, despite earning in foreign currency, paid just Rs. 180 billion, while retailers, taxed under sections 236G and 236H, contributed a mere Rs. 62 billion. This means the salaried segment paid over three times more than exporters and nearly eight times more than retailers, highlighting the disproportionate burden placed on fixed-income earners.

Compared to FY24, when salaried individuals paid Rs. 367 billion, collections from this group surged by Rs. 178 billion in FY25, further widening the gap between formal taxpayers and those in loosely regulated sectors.

The revelation comes as the FBR faces criticism over its failure to broaden the tax base effectively. The much-touted Tajir Dost Scheme, which aimed to register retailers nationwide, has underperformed. In response, the FBR has shifted focus toward stricter enforcement, including tracking financial transactions to bring non-filers into the tax net.

Amid growing concerns over tax equity, the government has announced tax relief for the salaried class in the FY25-26 budget. Individuals earning between Rs. 600,000 and Rs. 1.2 million annually will now be taxed at 1 percent, down from 5 percent. Those earning between Rs. 1.2 million and Rs. 2.2 million will see their tax rate fall from 15 percent to 11 percent. These cuts are expected to offer Rs. 50 billion in relief to middle-income earners in FY26.

Meanwhile, FBR officials have reiterated that remaining outside the tax net will no longer be viable, especially for individuals making significant banking transactions, property deals, or vehicle purchases. With enhanced digital tracking and real-time data integration, the board aims to bring more informal sector participants into the formal tax system.