Pakistan Proposes 3.5% Tax on YouTubers, TikTokers in Upcoming 2025-26 Budget

ISLAMABAD – The Government of Pakistan is set to introduce a new tax regime targeting digital content creators, including YouTubers and TikTokers, as part of the upcoming federal budget for the fiscal year 2025-26, expected to be presented on June 10.

According to media reports, a proposal has been put forward by the Institute of Cost and Management Accountants of Pakistan (ICMAP) to impose a **3.5% tax** on income earned from digital platforms such as YouTube, TikTok, and Instagram. The move is aimed at generating an estimated **PKR 52.5 billion** in additional revenue for the national exchequer.

The creator economy in Pakistan has witnessed exponential growth, particularly since the COVID-19 pandemic, with many influencers now earning substantial income through platform monetization and brand sponsorships.

Popular YouTuber and podcaster Junaid Akram welcomed the idea of taxation but raised concerns about the lack of clarity and framework. “We are already taxed in several ways. The State Bank deducts 1% on remittances from platforms like YouTube. Brands that hire us for promotions deduct withholding taxes before making payments. On top of that, we also pay annual income tax,” he stated.

Akram stressed the need for the government to clearly define **what kind of income** the proposed 3.5% tax would apply to and urged for a regulatory structure that formally recognizes digital creators. He pointed to international examples, such as Dubai, where influencers are issued licenses and operate under a regulated tax system.

Freelancer and digital expert Tahir Umar echoed similar sentiments, noting that the IT and freelance sectors are among the few that bring in **100% foreign exchange** with minimal local costs. “Rather than imposing new taxes, the government should incentivize this sector to grow and contribute even more to the economy,” he said.

Experts caution that without transparency and simplified tax systems, digital creators may either **avoid registration** or choose to keep their earnings offshore due to fears of bureaucratic complications and financial scrutiny.

While the government aims to expand the tax net, stakeholders insist that proper categorization, digital industry recognition, and confidence-building measures are essential before imposing any new financial burdens on content creators.