ISLAMABAD: The Federal Board of Revenue (FBR) has reported a remarkable 54.7 percent increase in withholding tax (WHT) collection from the salaried class, rising to Rs605.593 billion during fiscal year 2024-25 from Rs391.362 billion in 2023-24.
According to a report issued on Thursday, the share of WHT in total direct tax collection stood at 59 percent in 2024-25, compared to 60 percent in the previous fiscal year. The overall WHT collection reached Rs3,381.5 billion, up 23.5 percent from Rs2,739.1 billion in 2023-24.
The FBR attributed the sharp rise in salary-based WHT collection — an increase of Rs214.2 billion — to recent tax policy reforms, which included reducing the number of income tax slabs while simultaneously raising tax rates in each bracket. This adjustment, it said, had significantly boosted revenue from the salaried segment.
Substantial growth was also recorded in other categories: WHT from contracts rose 39 percent to Rs737.715 billion, while collection from electricity bills increased 11.2 percent to Rs144.371 billion. The report added that major WHT contributors, including contracts, imports, telephone, and exports, accounted for over 71 percent of total WHT revenues.
The FBR further noted that 14 out of 15 key WHT components posted positive growth, with only bank interest and securities declining slightly by 1.6 percent. Salaries, which previously ranked lower among top revenue sources, have now become the second-largest contributor to withholding taxes in the ongoing fiscal year.
