15 Sectors Account for Over Half of Sales Tax in Pakistan

Over half of Pakistan’s sales tax on local goods now comes from just fifteen major sectors, led by electrical energy, petroleum products, sugar, cement and cotton yarn. According to Federal Board of Revenue (FBR) data, 57.3 percent of domestic sales tax collection in FY25 came from these sectors, indicating their dominant position in Pakistan’s tax base. Domestic sales tax revenue reached Rs. 1,619.5 billion in FY25. This marks 32.4 percent growth compared to Rs. 1,222.9 billion collected in the previous year. Overall, the government recorded an additional Rs. 396.6 billion in revenue. Electrical energy remained the top contributor with 22.8 percent share, driven by higher electricity tariffs. In contrast, the share of POL products fell sharply to 2.6 percent from 6.9 percent last year, mainly due to reduced demand and policy changes. Despite most sectors showing growth, cigarettes and POL products recorded a decline in revenue contribution. Sales tax from motor vehicles posted exceptional growth during the year. Revenue from motor cars rose 158.8 percent, supported by a strong jump in production from 79,594 to 111,402 units and higher sales, which increased from 81,579 to 112,203 units. A similar trend was seen in the motorcycle segment. Sales tax collection surged 136.2 percent, driven by increased output from 1.15 million to 1.51 million units, while sales also grew from 1.15 million to 1.52 million units during the period. FBR documents show that the rise in production and demand for motor vehicles played a major role in boosting revenue collection during the year.