Pakistan is bringing social media earnings into the tax system. The Federal Board of Revenue (FBR) has proposed new rules to tax income from platforms like YouTube, TikTok, Instagram, Facebook, and X. Under the draft rules, authorities will use a fixed rate of Rs. 195 per 1,000 views to calculate the minimum taxable income for content creators.
This formula will help estimate earnings even if actual income is not fully declared. Taxable income will be based on actual earnings or the views-based formula, whichever is higher. Creators can claim up to 30% deduction for business expenses. Those with over 50,000 subscribers or high quarterly views will be treated as businesses and must file special tax returns.
The Finance Bill 2026-27 also introduces a 5% withholding tax on such digital earnings. Banks will deduct this tax when payments from social media platforms are received in Pakistani accounts. Quarterly advance tax payments will be required.
The move aims to document the growing digital economy and increase tax revenue. Many young Pakistanis earn good money through online content, but most of it was outside the tax net.
Supporters say it is fair to tax this income like any other business. However, some creators worry it may reduce their earnings and affect creativity. The draft rules are open for feedback before final implementation.
