The Senate committee has approved the government’s proposal to impose a 5 per cent withholding tax on social media earnings under the Budget 2026-27, according to reports on Monday. However, income up to Rs600,000 per year will be exempt from tax.
Tax on social media earnings approved in Pakistan
According to details, the Senate Standing Committee on Finance has taken an important decision for Pakistani users earning from social media platforms like YouTube, Facebook, Instagram, TikTok, etc.
The government’s proposal to impose a 5 per cent withholding tax on its income.
This approval was given in a meeting of the committee chaired by Chairman Saleem Mandviwala.
During the meeting, the Chairman of the Federal Board of Revenue said that currently a large number of people in Pakistan are earning huge amounts of money through social media, ‘We are not stopping their earnings, rather the government is only demanding its fair share from these social media earnings.’
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On this, Chairman of the Committee Saleem Mandviwala smiled and said, ‘Let people earn from social media! You want to collect tax because you see a huge amount coming to the government from there.’
Committee member Senator Abdul Qadir expressed reservations about this tax and said that if the youth are bringing dollars into the country with their hard work, then they should be allowed to work freely.
He said, ‘Those who are doing something on their own in this era of economy, the government should let them go and not burden them.’
Who will have to pay?
However, after discussion, the Standing Committee unanimously approved the proposal of a 5 per cent withholding tax.
The Chairman of FBR clarified that this tax will not be applicable equally to all social media users. But an income limit has been set for it.
No tax will be applicable to those earning up to Rs600,000 annually from social media.
Digital creators earning between Rs600,000 and Rs1.2 million per year will be subject to a 5 per cent withholding tax.
