Karachi, April 23, 2025 – The Federal Board of Revenue (FBR) is actively considering the introduction of a new tax regime targeting income generated through digital platforms such as YouTube and other social media channels.
This move is being explored as part of the upcoming federal budget for 2025-26, with the aim of tapping into the rapidly expanding digital economy.
According to sources within the FBR, the decision to explore this tax measure stems from a noticeable surge in earnings made by content creators and influencers operating on platforms like YouTube, TikTok, and Instagram. The FBR believes that taxing these earnings could help broaden the tax base and align the country’s fiscal policies with global digital trends.
Proposals to implement such a tax have also been submitted by several policy think tanks. Notably, the Institute of Cost and Management Accountants of Pakistan (ICMAP) has recommended that a 3.5% tax be imposed on annual earnings exceeding PKR 5 million from platforms like YouTube. The ICMAP estimates that this tax could contribute an additional Rs52.5 billion to the national exchequer—approximately 0.06% of Pakistan’s GDP, which is currently around $350 billion (Rs87.5 trillion).
The FBR is seriously evaluating the feasibility of this proposal, with officials acknowledging that YouTube and similar platforms are reshaping economic activity and creating new revenue streams. As part of its strategy, the FBR may also consider introducing a tax on digital subscription services such as Netflix, Disney+, and Hotstar. However, exemptions would be considered for low-income users and minors to ensure that the tax burden remains equitable.
By including YouTube and other social media earnings in the tax net, the FBR aims to ensure fair contribution from high-earning digital entrepreneurs and support public sector development. This potential policy shift underscores the FBR’s evolving approach to modern taxation as the country adapts to global digital transformations. The FBR is expected to finalize its position on YouTube-related earnings in the weeks leading up to the official budget announcement.