The federal government has proposed in the Finance Bill 2026 to impose a 5% withholding tax on revenue received by social media influencers through digital platforms like YouTube, Facebook, Instagram and TikTok.

The draft legislation states that banks and non-banking financial institutions will have to deduct the tax anytime payments related to social media profits are credited or received in an account.

The bill defines a social media influencer as someone who earns money through social media. The plan includes payments for domestic remittances, transfers and direct credits to accounts tied to digital content development and online activity.

The proposed framework proposes that resident individuals active tax payers will be subject to 5% withholding tax on their social media revenue. Non-resident persons and entities that earn revenue through such platforms will be subject to the same rate.

The Finance Bill provides that the withholding tax shall be the minimum tax liability for resident tax payers. Where there is no permanent establishment of a non-resident in Pakistan, the sum so deducted shall be deemed to be a final tax.

The plan is part of the federal budget for FY 2026-27, which was presented by Finance Minister Muhammad Aurangzeb in the National Assembly on Friday.

The government has recommended a total budget outlay of Rs18.771 trillion including Rs8.054 trillion for debt servicing Rs3 trillion for security spending and Rs1 trillion for the federal development project.

– The Federal Board of Revenue (FBR) has put forward a host of substantial tax initiatives to augment revenue in the Budget 2026-27.

The tax collection target for the upcoming fiscal year was fixed at Rs15,264 billion and the budget was expected to include about Rs650 billion in additional levies, including nearly Rs150 billion in new taxes, sources said.

The proposed idea may apply sales tax on hundreds of retail-packed commodities, including milk, baby formula and other dairy products.

Other items such as ghee, cooking oil, sweets, pasta and several spices have also been recommended to be included under the 18% General Sales Tax (GST) regime.

The suggestions also include taxation of retail-packed agricultural inputs, insecticides, plastic household products, kitchenware, storage items, bags, suitcases and other travel goods.

Other items projected to come under the sales tax net are bathroom fittings, sanitary equipment and domestic accessories like crockery, as well as all forms of footwear.

In the auto sector, the proposal is to tax the retail sales of autos and motor parts. Luxury SUVs costing between Rs20 million and Rs30 million could be taxed at 30%, while those beyond Rs30 million could be taxed at 40%.

There is also a proposal to levy a 5% tax on purchases from unregistered suppliers and to boost the tax rate on distributors from 0.25% to 0.50%. Under the current idea, commercial importers that sell imported raw materials could also be taxed at 3%.

The Federal government has earmarked Rs895.4 million for the internal expenditures of the Prime Minister’s Office in the 2018 budget, official budget records released on Friday show.

The documents also show an allocation of Rs92.12 million to the public affairs section of the Prime Minister’s Office.

The government has allocated Rs1.47 billion for the Federal Public Service Commission (FPSC) in the expenditure of the upcoming fiscal year. Meanwhile, the proposed budget is set to allocate Rs35.43 crore for the Special Investment Facilitation Council (SIFC).

The overall allocation for Federal Board of Revenue (FBR) is Rs85.60 billion as per the budget documents. Of this Rs29 billion would be spent on pay and allowances of FBR staff.

For administrative expenses, over Rs23.22 billion have been earmarked for the Islamabad Capital Territory and over Rs17 billion for the National Assembly.

The next financial year has been allocated about Rs9.67 billion for the Senate of Pakistan and Rs1.20 billion for parliamentary affairs.

The allocations form part of the overall federal budget for the 2026-27 fiscal year, which sets out government spending across major organisations and ministries.