ISLAMABAD: Pakistan’s salaried workers paid Rs144 billion in income tax during the first quarter of fiscal year 2026-27, according to provisional Federal Board of Revenue data. The amount exceeded the combined tax contribution of the retail and real estate sectors by Rs90 billion. Together, those sectors contributed around Rs54 billion between July and September.
The figures highlight a widening gap between tax payments from salaried individuals and collections from property transactions and retail businesses.
Salaried Tax Collection Rises 10.2%
Income tax collected from salaried individuals increased by Rs13.4 billion during the quarter.
The collection rose 10.2% compared with the same period last year. Their annual contribution has also increased sharply in recent years.
According to official figures, salaried workers paid Rs391 billion before the IMF programme. Their contribution reached Rs629 billion by June 2026.
The government announced tax relief for salaried taxpayers in the latest budget. The measures included tax rate reductions of up to three percentage points and the removal of a 9% surcharge.
The government also raised the annual income threshold for the maximum 35% tax rate from Rs4.1 million to Rs7 million.
Property Tax Collection Drops 38%
Meanwhile, income tax collection from the real estate sector fell 38% year over year to Rs35.2 billion during the first quarter.
The decline followed a 50% reduction in advance tax rates on property transactions.
The government reduced the advance tax on property purchases from 2.5% to 1.25%. It also replaced three property-sale tax slabs with a single 2.75% rate, compared with the previous 5.5% rate.
As a result, tax collected from property sales dropped 42% to Rs23 billion. It stood at Rs39.5 billion during the same period last year.
Tax from property purchases also fell 31%, declining from Rs17.7 billion to Rs12.2 billion.
The real estate sector had contributed Rs200 billion in income tax during FY2023-24. Its contribution later reached Rs236 billion in FY2025-26 before the latest rate reductions.
Retail and Wholesale Collections Remain Almost Flat
Tax collection from wholesalers and retailers showed limited growth during the quarter.
Both sectors paid Rs18.4 billion in withholding taxes from July to September. That represented an increase of only Rs244 million, or 1.3%, from the previous year.
Wholesalers contributed Rs6.2 billion, marking a 10% decline. Retailers, meanwhile, paid Rs11.3 billion, up 8.3% year over year.
The FBR has introduced a fixed tax scheme for retailers as part of efforts to broaden the tax base. However, the latest figures show limited growth in collections from the sector.
Tax Burden Remains a Key Issue
The latest figures show that salaried workers continue to contribute substantially more income tax than retailers and the real estate sector combined. At the same time, salaried households face higher costs from fuel and other essential goods.
The government currently charges a petroleum levy of Rs80 per litre and a climate support levy of Rs5 per litre. Rising fuel costs can also affect transportation and the prices of everyday products.
Overall, the first-quarter figures show contrasting trends across major taxpayer groups. Salaried tax payments increased, while property-related collections declined sharply and retail and wholesale contributions remained largely stagnant.
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