During the first quarter of the current fiscal year, salaried individuals contributed Rs. 111 billion in taxes, which is 1,550 percent higher than the taxes paid by traders, according to Federal Board of Revenue (FBR) data. This amount represents a Rs. 40 billion increase, or 56 percent more than what was collected from salaried individuals during the same period last year. In contrast, traders contributed only Rs. 6.7 billion, despite facing a 150 percent rise in withholding tax rates on goods.
FBR’s new Tajir Dost scheme, which aims to bring more retailers into the tax net, saw registered retailers pay a meager Rs. 1.2 million in taxes by mid-October.
READ MORE: “Rawalpindi Students Clash with Police During Protests Over Alleged ‘Lahore College Rape Incident’”
Private sector employees, taxed at steep rates of around 39 percent, paid Rs. 83 billion in income tax, while government employees contributed Rs. 28 billion. This heavy tax burden on salaried individuals comes in the wake of the government’s agreement with the International Monetary Fund (IMF) for a $7 billion loan. As part of the deal, the government plans to raise Rs. 357 billion in personal and corporate income taxes this fiscal year.
