Government Announces Withholding Tax on Income from Social Media Platforms

Islamabad (Kudrat News): The Finance Bill has announced the imposition of withholding tax on income earned from social media platforms.

According to the Finance Bill, withholding tax will be applied on income generated through social media platforms, and tax will be deducted at the time of receipt of funds in the relevant account.

The bill states that a 5 percent tax will be deducted at the time of receiving payments in accounts from such platforms. A 5 percent deduction will also apply to the income of resident individuals included in the active taxpayer list.

It further added that a 5 percent withholding tax will also be applicable on the accounts of non-resident individuals. In the case of non-residents who do not have permanent residence in Pakistan, the deducted tax will be treated as final tax.

According to the Finance Bill, a social media influencer is defined as a person or entity earning income through such platforms. Payments will be considered as domestic remittance, transfer, or credit, while the tax burden for resident individuals will be kept minimal.