Pakistan is moving to tax social media earnings from platforms such as YouTube, TikTok, and Instagram, as authorities widen their effort to document digital earnings and raise revenue from online activity.

The Federal Board of Revenue (FBR) has proposed a special procedure for taxing income from remunerative social media content. The proposed rules would cover creators who earn money through user engagement, audience reach, advertising, sponsorships, or other forms of monetisation.

Up to 30%

Under the draft rules, the minimum income of a social media creator would be calculated after deducting expenses from total remuneration. The deductible expenses would be allowed up to a maximum of 30% of total revenue.

The total remuneration would be taken as the higher of two amounts: the income estimated through a revenue-per-mille formula based on views and posts, or the actual amount received by the creator in cash or kind.

For calculation purposes, the FBR has proposed Rs. 195 as the revenue generated per 1,000 views on videos shared on YouTube. The rate may be revised from time to time.

The rules also require creators to pay advance income tax under the existing law. Their social media income would have to be declared in a separate part of the annual income tax return.

If a creator declares income lower than the amount calculated under the proposed formula, the relevant tax commissioner would be allowed to rectify the return and recover the tax due under the Income Tax Ordinance.

The proposal marks one of Pakistan’s clearest attempts to tax the creator economy, a fast-growing segment where income can come from foreign platforms, local brand deals, sponsorships, affiliate marketing, and direct payments.

The move may affect YouTubers, TikTokers, Instagram influencers, and other digital creators who earn from online audiences in Pakistan. However, the exact impact will depend on how the final rules are notified and how the FBR applies the formula across different platforms.

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