- July 13, 2026
- Posted by: Tresmark
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Direct taxes are expected to contribute around 50% of Pakistan’s total tax collection in FY2026-27, according to the Federal Board of Revenue (FBR), reflecting a continued shift toward a more balanced tax system.
The FBR’s revenue forecasting report noted that the composition of tax revenues has changed significantly in recent years, with direct taxes maintaining a dominant share of overall collections during FY27.
The report said this trend represents progress toward a fairer and more equitable taxation framework by increasing reliance on income based taxes rather than indirect levies.
It added that a higher share of direct taxes generally improves the progressivity of the tax system, enhances fairness, and reduces exposure to fluctuations in consumption and trade.
The FBR also highlighted that direct tax revenues are likely to remain more stable over the medium term, particularly as documentation and tax compliance continue to improve.
According to the report, the projected increase in tax revenue, along with the changing revenue mix, reflects both quantitative growth and qualitative improvements in revenue mobilization, supporting Pakistan’s long term fiscal sustainability and a more resilient tax framework.
