THERE is an ancient principle of just taxation, articulated across every serious tradition of political philosophy from Ibn Khaldun to Adam Smith, that a state must tax what it can fairly reach rather than simply what it can most easily find. The distinction matters enormously, because the easiest things to tax are rarely the fairest things to tax and a fiscal system built on convenience rather than equity does not merely collect revenue. It redistributes the burden of the state downward, onto those least able to carry it, while releasing upward those most able to contribute. Pakistan’s electricity bill has become the most eloquent illustration of how completely that principle has been abandoned.

Federal Board of Revenue informed the Senate this week that it collected Rs 476 billion in taxes through electricity bills in FY2026 alone. Across the previous fiscal year it collected Rs 562 billion through the same mechanism and Rs 515 billion the year before that.

The four-year cumulative total approaches Rs 1.9 trillion, extracted not through a broad, equitable tax system applied across the economy but through a single monthly document that arrives in every household regardless of income, regardless of tax liability and regardless of whether the person paying it has ever been assessed for taxation at all. The collections in FY2026 included Rs 351 billion in sales tax and Rs 124 billion in........

© Pakistan Observer