ISLAMABAD: The Federal Board of Revenue is considering a new taxation mechanism targeting TikTok content creators, a Senate Standing Committee on Finance and Revenue meeting at Parliament House was informed on Wednesday. The move comes amid growing concerns about the need to bring digital earnings into the tax net. Senator Faisal Vawda told the committee that the FBR is finalising a plan to tax income generated by TikTokers, with Punjab expected to yield the largest share of recoverable taxes. He urged immediate enforcement of the measure to ensure compliance among high-earning digital content producers.
During the session chaired by Senator Saleem Mandviwalla, members also examined the Pakistan Remittances Initiative and the government’s remittance subsidy policy. Deputy Governor State Bank of Pakistan briefed the committee on changes to the subsidy, which was introduced in 2020 at 20 Saudi riyals per transaction, raised to 30 riyals in 2024, and later reduced back to 20 riyals. This adjustment prompted questions from senators about its impact on beneficiaries and the transparency of its administration. Vawda criticised the reversal, describing the policy as a “scandal” and alleging that commercial banks had been benefiting disproportionately from the scheme. He demanded a formal inquiry and urged FBR to recover any misappropriated funds.
Chairman Mandviwalla voiced similar concerns, pointing out that while the Pakistan Remittances Initiative was designed to facilitate overseas Pakistanis, its financial benefits were failing to reach the intended recipients. Instead, banks and money transfer operators appeared to be absorbing the subsidy. He called for rationalisation of transaction costs and stricter oversight to ensure remittance beneficiaries in Pakistan receive full value. The committee directed the Ministry of Finance to prepare a detailed report covering expenditures and reversals linked to the remittance subsidy scheme over the past three to four years and recommended a comprehensive review of the framework to improve transparency and prevent misuse.
In response, Minister of State for Finance and Revenue Bilal Azhar Kayani assured the committee that the issue would be thoroughly examined in consultation with State Bank and other stakeholders. He emphasised the need to streamline the mechanism and address gaps in implementation. Separately, the FBR chief briefed the committee on the non-implementation of a Presidential Order issued on July 16, 2025, explaining that the matter is currently under litigation before the Sindh High Court. The developments highlight the government’s ongoing efforts to address loopholes in revenue collection and remittance policies while also extending taxation to new sectors such as digital content creation.
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