Pakistan

Social security contributions

Nominal social security and Employees Old Age Benefit contribution is collected from the employers. Employee is also responsible for a nominal contribution in respect of Employees Old Age Benefit.  Employers are responsible to collect and pay on a monthly basis.

Consumption taxes

Value-added tax (VAT)

VAT (locally termed as ‘sales tax’) is ordinarily levied at 18% on the value of goods, unless specifically exempt, alter allowing related input credits. Provinces levy sales tax on certain services. See the Other taxes section in the Corporate tax summary for more information.

Tax on value of capital assets in Pakistan

Through Finance Act, 2022, a tax on deemed income from immovable property was introduced, under which resident persons owning immovable property in Pakistan, subject to certain exclusions, were taxed on deemed income computed at 5% of the fair market value of the property. The tax was charged at a rate of 20% of such deemed income, resulting in an effective tax of 1% of the property's fair market value.

However, this tax has been abolished through Finance Act, 2026 following the Federal Constitutional Court's decision declaring the provision ultra vires.

Inheritance, estate, and gift taxes

There are no inheritance, estate, or gift taxes in Pakistan.

Property taxes

Property owners are required to pay property tax levied and collected by provincial governments through municipal governments at varying rates.

Stamp taxes

Stamp duty is a provincial levy and is collected on property registrations, property transfers, shares transfers, power of attorneys, etc.

Registration taxes

Registration tax is a provincial tax and payable mainly on registration of property and vehicles.