The federal government is preparing to introduce Rs. 600 billion in new taxes in the upcoming 2025–26 budget, targeting freelancers, vloggers, TikTokers, YouTubers, pensioners, and other sectors to meet IMF conditions and boost revenue.
Key Proposed Tax Measures:
Tax on Social Media Income
- 3.5% tax on income earned through platforms like YouTube and TikTok.
- Aims to collect Rs. 52.5 billion from content creators and freelancers.
Tax on High Pensions
- 2.5% to 5% tax on pensions above Rs. 400,000 per month.
- Could generate Rs. 20–40 billion.
- Pension costs have already hit Rs. 673 billion and may cross Rs. 1 trillion.
GST Adjustment on Items Like Sugar
- GST to be adjusted based on real market prices using PBS data.
- Example: GST on sugar is currently based on Rs. 72.22/kg, while the actual price is around Rs. 150.
- Expected revenue: Rs. 70–80 billion.
Excise Duty Hike on Processed Foods
- 20% increase in federal excise duty (FED) on items like snacks and biscuits.
- Long-term goal: 50% FED by 2029.
- Cigarette excise duties may also rise.
Petroleum Levy & Carbon Tax
- Possible Rs. 5/liter increase in levy on petrol and diesel as a carbon tax.
- A new levy on furnace oil is under review.
- Projected revenue: Rs. 35–80 billion, depending on rates.
End of the Non-Filer Category
- Govt plans to eliminate the non-filer category via a new bill.
- Non-filers may be banned from buying cars and property.
- Section 114C of the Income Tax Ordinance will define new thresholds.
Tax Collection from Retailers
- To meet IMF targets, the govt aims to collect Rs. 295 billion from retailers by Dec 2025.
- Plans include higher advance taxes on distributors.
Excise Duty on Fertilizers & Pesticides
- 5% increase in FED proposed by IMF.
- Could raise over Rs. 30 billion.
These tax proposals are part of broader fiscal reforms to increase revenue, curb deficits, and meet IMF loan requirements. The final budget will confirm which of these measures are implemented.
