BUDGET 2026-27: Senate panel backs 5pc tax on earnings from social media

• Govt signals gradual end to super tax• State minister says target of bringing 3.5m retailers into tax net in one year ‘unrealistic’• NA panel seeks detailed estimates of revenue generation, relief measures to assess their overall economic impact

ISLAMABAD: A parliamentary committee on Monday approved a five per cent tax on earnings generated through social media platforms by both local and foreign digital content creators, as lawmakers continued their review of proposals under the Finance Bill 2026.

The move reflects the growing significance of social media as a source of income, with digital platforms increasingly serving as lucrative business avenues rather than merely communication tools. Content creators, influencers and online entrepreneurs are now generating millions of rupees annually through platform monetisation, advertising revenue and audience engagement.

The Senate Standing Commi­ttee on Finance, chaired by Senator Saleem Mandviwalla, reviewed the proposed taxation framework and endorsed the mechanism for bringing social media earnings into the tax net. Finance Minister Muhammad Aurangzeb and Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial briefed the committee on the bill’s provisions.

Separately, the National Assembly Standing Committee on Finance in its meeting, headed by MNA Naveed Qamar, directed the finance ministry and FBR to submit detailed estimates of revenue generation and relief measures to assess their overall economic impact.

The proposed tax on social media income sparked debate am­ong committee members, with some expressing concerns that additional taxation could dis­co­urage foreign exchange inflows.

Senator Saleem Mandviwalla warned that higher taxes might reduce incentives for digital earners to bring income into Pakistan. Senator Abdul Qadir echoed similar concerns, arguing that individuals earning through overseas digital platforms should be encouraged rather than burdened with excessive taxation.

Responding to the criticism, the FBR chairman said social media earnings should be treated like any other taxable income. FBR officials informed the committee that annual social media income of up to Rs600,000 would remain exempt. Earnings between Rs600,000 and Rs1.2 million would be subject to a five per cent tax under the proposed framework.

“We are simply asking for our share........

© Dawn Business