FBR Proposes Tax on Foreign YouTubers’ Pakistani Income

The Federal Board of Revenue (FBR) has introduced a proposed taxation regime aimed at non-resident content creators generating revenue from Pakistani audiences, specifically targeting monetised YouTube content. The proposed framework suggests a levy of Rs195 per 1,000 views, applicable to income derived from viewership within Pakistan.

This proposal has been issued through amendments to the Income Tax Rules under the authority of the Finance Minister. The FBR has opened the proposal for public feedback, allowing a seven-day window for objections prior to final implementation. The objective is to extend the tax net to individuals earning Pakistan-sourced digital income without maintaining a physical presence in the country.

Based on current estimates, the fixed tax rate per 1,000 views may result in an effective tax liability ranging between approximately 16% and 66%, depending on the creator’s revenue per mille (RPM). Industry benchmarks indicate that earnings typically fall between $1 and $3 per 1,000 views, with higher rates observed for audiences in developed regions.

The proposed rules establish clear thresholds for applicability, targeting non-resident individuals who engage consistently with Pakistani users. This includes those exceeding 50,000 users annually or 12,250 users on a quarterly basis. Affected individuals would be obligated to pay advance income tax and disclose such income through a designated section within the tax return.

Additionally, the framework introduces a minimum income determination mechanism, whereby taxable income will be calculated based on the higher of either estimated earnings—derived from average views, posting frequency, and RPM—or actual income received, whether in cash or in kind. Deductible expenses will be restricted to a maximum of 30% of total revenue.

The proposed regime is particularly directed at non-resident Pakistanis producing monetised content relating to Pakistan’s economy, political landscape, and other domestic sectors, especially those residing in jurisdictions such as the United States, Canada, and the United Kingdom.

From an enforcement perspective, tax authorities have outlined that in cases where declared income falls below the computed threshold, the relevant Commissioner shall have the authority to amend the return and initiate recovery proceedings under the Income Tax Ordinance, 2001.

Officials have further indicated that effective implementation of this framework will require collaboration with digital platforms, including YouTube, to ensure proper tax collection, reporting accuracy, and regulatory compliance.