Pakistan’s salaried class continues to bear a disproportionate share of the country’s tax burden, contributing more in income tax than several wealthier segments combined, according to official data.
Figures released by the Federal Board of Revenue (FBR) show that salaried individuals paid Rs365 billion in income tax during the first eight months (July–February) of the current fiscal year, compared to Rs332bn in the same period last year.
The increase comes despite limited relief provided in tax slabs, highlighting the government’s growing dependence on documented income segments for revenue collection.
In contrast, tax contributions from sectors such as retail, wholesale, exports and real estate remain significantly lower, reflecting longstanding challenges in bringing these segments into the tax net.
Over the past five years, tax payments by the salaried class have risen sharply. A study by economist Dr Sajid Amin Javed noted that between 2020 and 2025, salaried individuals paid Rs1.14 trillion in taxes, compared to Rs16.5bn from retailers and Rs35.2bn from wholesalers and distributors.
The data points to structural weaknesses in the tax system, where large segments of the economy remain undocumented. According to the State Bank of Pakistan (SBP), only about 179,000 retailers out of an estimated 5 million micro, small and medium enterprises are registered under the point-of-sale system.
Experts say politically influential sectors, including retail, real estate and agriculture, have historically resisted documentation, while successive governments have struggled to expand the tax base.
Despite discussions with the International Monetary Fund (IMF), there appears to be no concrete plan so far to bring retailers into the tax net in the upcoming 2026–27 budget.
Analysts warn that unless the government succeeds in broadening the tax base, the burden will continue to fall on salaried individuals and other compliant taxpayers, deepening perceptions of inequity in the system.
While the government has moved to tax high-income pensioners earning over Rs10 million annually, their contribution has remained minimal so far during the current fiscal year.
