Karachi, April 30, 2026 — Retailers in Karachi contributed Rs6.25 billion in income tax during fiscal year 2024-25, marking a significant increase in tax collection, according to data released by the Federal Board of Revenue (FBR).
The latest figures show a 121% growth compared to Rs2.83 billion collected in FY24, reflecting improved enforcement measures and regulatory changes.
Strong Growth Driven by Enforcement
Officials at the Large Taxpayers Office Karachi attributed the surge in revenue to enhanced monitoring and stricter compliance requirements.
Authorities have tightened oversight on manufacturers and importers to ensure accurate declaration of sales made to retailers, which has significantly boosted withholding tax collection.
Tax Collection Under Section 236H
The Federal Board of Revenue collects advance tax from retailers under Section 236H of the Income Tax Ordinance, 2001.
Under this provision:
• Manufacturers, distributors, wholesalers, and importers collect advance tax at the time of sale to retailers
• The collected tax is adjustable against the retailer’s final tax liability
This mechanism has played a key role in documenting the retail sector and improving tax compliance.
Office-wise Tax Collection in Karachi
| Tax Office | FY25 Collection | FY24 Collection |
| Large Taxpayers Office | Rs1.61 billion | Rs837 million |
| Corporate Tax Office | Rs403 million | Rs186 million |
| Regional Tax Office – I | Rs1.73 billion | Rs647 million |
| Medium Tax Office | Rs716 million | Rs478 million |
| Regional Tax Office – II | Rs1.80 billion | Rs676 million |
Contribution to National Revenue
Karachi-based tax offices accounted for approximately 16.5% of total income tax collection from retailers nationwide, highlighting the city’s central role in Pakistan’s retail economy.
Outlook
Tax authorities expect further growth in revenue collection as enforcement measures continue and documentation of the retail sector improves across the country.