Pakistani Government Targets High Net-Worth Individuals, Freelancers, and Vloggers in New Tax Reform Initiatives

To revive the struggling economy, the Pakistani government is intensifying its tax reform efforts, aiming to broaden the tax base and increase revenue. Senior journalist Saleh Zafar recently detailed these developments in an article for an Urdu publication, noting that the Federal Board of Revenue (FBR) is now focusing on high net-worth individuals, including freelancers and vloggers earning in foreign currencies.

Zafar reports that the FBR has proposed several significant measures, including equalizing income tax rates for salaries and business incomes, raising overall tax rates, and incorporating freelancers and vloggers into the tax system. Additionally, there are proposals to tax remittances and, pending approval, introduce an agricultural income tax.

The alliance government is also considering taxing higher pensions starting from the next fiscal year. This initiative is part of a broader strategy to enhance income tax collection in the upcoming fiscal budget.

These reforms are partly driven by demands from the International Monetary Fund (IMF), which has called for taxes on various income types. The IMF has noted that many influential individuals hide their actual income within the agricultural sector to avoid taxes. Implementing an agricultural income tax has become a crucial structural benchmark under the new IMF program.

The proposed changes underscore the government’s commitment to tackling long-standing tax evasion issues and ensuring a fairer tax system that captures all income segments, especially those previously outside the tax net.