The Federal Board of Revenue (FBR) collected Rs605.6 billion in withholding taxes from the salaried class during fiscal year 2024–25, compared to Rs391.4 billion a year earlier, reflecting a 54.7% increase, according to the latest data.
The FBR report stated that withholding taxes accounted for 59% of total direct tax collection in FY25, slightly down from 60% in the previous fiscal year. The sharp rise in salary-based withholding came mainly due to fewer income tax slabs and higher rates in each category.
Total withholding tax (WHT) collection reached Rs3.38 trillion in FY25, up 23.5% from Rs2.74 trillion in FY24. Collections from contracts rose 39% to Rs737.7 billion, while WHT from electricity bills increased 11.2% to Rs144.4 billion.
The report noted that 14 of the 15 major WHT components recorded growth, with only bank interest and securities showing a 1.6% decline. Salaries emerged as the second-largest contributor to WHT revenues, followed by contracts, imports, telecommunication, and exports.
The FBR attributed the overall increase to policy changes and stronger compliance across key sectors.
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