Karachi, August 7, 2025 – In a staggering revelation, Karachi’s citizens and business community have coughed up a jaw-dropping Rs34 billion in withholding income tax on electricity bills during the fiscal year 2024–25.
This massive sum underscores the growing financial strain placed on consumers amid rising utility costs.
Official figures reveal a dramatic 32% surge in electricity-related tax collection compared to the previous fiscal year, when the total stood at Rs25.75 billion. The spike is attributed to skyrocketing electricity charges imposed by K-Electric (KE), which pushed households and businesses to their financial limits while feeding an unprecedented windfall to the Federal Board of Revenue (FBR).
The early months of FY25 saw electricity tariffs reach unbearable highs, fueling record tax collections. However, as tariffs slightly eased toward the end of the fiscal year and commercial activity slowed down, the revenue stream faltered. In June 2025, withholding tax collection on electricity bills plummeted by a shocking 41%, falling to Rs2.51 billion from Rs4.27 billion in June of the previous year.
K-Electric, acting as a collection agent for the FBR under Section 235 of the Income Tax Ordinance, 2001, deducts this tax directly through monthly bills, leaving consumers with no option but to pay.
As Karachi continues to grapple with the dual blow of soaring electricity costs and relentless taxation, residents are demanding transparency, accountability, and meaningful relief from what many are calling an unsustainable burden.