In an effort to broaden the tax base and boost revenue, the Pakistani government is planning to impose new taxes on freelancers, vloggers, and YouTubers in the upcoming federal budget for 2025–26. The move is expected to generate an additional Rs. 500 to 600 billion, according to early reports.
Sources within the Ministry of Finance and the Federal Board of Revenue (FBR) confirm that digital income earners — particularly those operating on platforms like YouTube, Instagram, and freelance websites — will be brought under formal taxation. These measures are part of a broader strategy to integrate the expanding digital and gig economy into the national tax net.
The FBR is reportedly preparing to set a tax collection target of Rs. 14.1 to 14.3 trillion for the next fiscal year, representing a 16% to 18% increase compared to last year’s target. Officials say this increase is aligned with expected GDP growth of 3.6% and inflation at 7.7%.
However, much of the anticipated revenue jump will come from new tax measures — not just economic expansion. The government is under pressure from both domestic policy goals and international lenders to improve documentation and widen the tax net. Officials believe that online content creators and remote workers represent a sizable but untapped source of revenue.
In recent years, Pakistan has seen a surge in online businesses and freelance activity. Platforms such as YouTube, Fiverr, and Upwork have enabled thousands of Pakistanis to earn in foreign currency. Despite their growing economic footprint, many of these digital earners remain outside the formal tax system.
Tax authorities are now considering mechanisms such as mandatory registration, income declarations, and withholding taxes on payments received through digital channels. There is also a possibility of coordination with banks and payment processors to trace digital earnings.
The proposed move is expected to be met with mixed reactions. While some experts welcome the step as a way to ensure fair contribution to the economy, others warn that over-taxation could discourage online entrepreneurship and hurt digital innovation.
Further details will be announced once the official budget is presented in parliament next month.