The Federal Government is now considering to increase tax on freelancers and online content creators earning from social media platforms like YouTube and TikTok. According to the details, the Federal Government is considering imposing a 30% tax on freelancers and online content creators in the upcoming budget for the fiscal year FY2022-23.
New Budget Will Now Withdraw Perks Given to Online Content Creators and Freelancers
The upcoming budget would remove the perks and subsidies given to freelancers exporting their IT services and bringing the much-needed foreign exchange to the country, which would be a massive setback for the whole industry as it will worsen the financial condition of lower-income people. Furthermore, it is being informed that offices of online platforms and social media apps would be set up in Pakistan, and earnings from them would be made in local Pakistani currency.
In addition to this, the decision to raise taxes on freelancers and online content creators has been made because of strict conditions set by the International Monetary Fund (IMF) in order to restore the loan program. According to well-placed sources, the coalition government is also pondering a proposal to increase income tax on income generated through online gaming, TikTok, YouTube, and other social media platforms.
The authorities are also considering a proposal to increase income tax on income of over Rs1 million per annum, they added. The development took place amid tough requirements imposed by International Monetary Fund (IMF) to secure a $1 billion tranche from the international lender.
Influencers Oppose Government’s Expected Decision
Influencers in pakistan are raising their voices against the latest development initiated by the government. Some of them have taken this matter to social media, one such post is a video with the caption, “Digital and creator economy that created unparalleled opportunities for the Youth. Save freelancers, save the IT industry. Please go to Twitter and use #saveitindustry and tweet. Talk about 30% tax that is unacceptable. The Government only sees tweets.”