Islamabad, January 23, 2026 — The Federal Board of Revenue (FBR) has reported a sharp 21 percent decline in the collection of advance income tax on electricity consumption during the first half (July–December) of fiscal year 2025-26, compared to the same period last year, according to provisional data.
Advance tax collection from electricity consumption fell to Rs67.75 billion in 1HFY26, down from Rs86.11 billion collected in the corresponding half of the previous fiscal year. FBR officials attributed the decline primarily to lower electricity tariffs, along with sluggish economic activity and reduced industrial output during the period.
Despite the overall drop in half-yearly figures, the decline in December 2025 was relatively modest. Advance income tax collected on electricity consumption during the month decreased by just 3 percent, reaching Rs12.43 billion, compared to Rs12.85 billion collected in December 2024.
The FBR collects advance income tax on electricity bills under Section 235 of the Income Tax Ordinance, 2001. Different rates of advance tax apply to commercial, industrial, and domestic electricity consumers, depending on their category and consumption level.
However, domestic consumers whose names appear on the Active Taxpayers List (ATL) are exempt from paying advance income tax on electricity consumption.
Tax analysts note that persistent weakness in electricity-based tax collection may signal broader challenges in economic recovery and industrial demand, which could impact overall revenue performance during the fiscal year.
Advance Income Tax on Electricity – Comparison
| Period | Collection (Rs bn) | Change |
| 1HFY26 (Jul–Dec) | 67.75 | −21% |
| 1HFY25 (Jul–Dec) | 86.11 | — |
| December 2025 | 12.43 | −3% |
| December 2024 | 12.85 | — |