Banks have started deducting withholding tax at source from earnings of influencers, content creators, and digital publishers through platforms such as YouTube and Facebook, top sources told ProPakistani.
Non-filers face deductions of up to 10 percent, while the standard rate under the new regime is 5 percent for filers.
These earnings typically contribute to Pakistan’s overall IT services-led exports. Sources said scheduled banks are now applying tax deductions when payments from international digital platforms are credited to Pakistani users’ accounts.
The deduction is being made by banks at the time of payment realization, while platforms such as Google AdSense, YouTube, and Facebook are not directly deducting the tax. Instead, the tax collection is being carried out through Pakistan’s banking channels.
The deductions apply to earnings generated through social media monetization, digital advertising, and other online revenue streams.
Sources clarified that these earnings are being treated under the IT export category, as revenues received by Pakistani creators from foreign digital platforms represent export proceeds for digital services.
The mechanism covers income generated through platforms including YouTube, Facebook, Instagram, and other digital platforms, where creators earn through advertising, content monetization, and related digital services.
Under the Finance Bill 2026-27, payments received by digital content creators and social media influencers through foreign platforms have been brought into the withholding tax regime. This way, banks are responsible for deducting tax at source when such funds are received.
The new framework is expected to impact thousands of Pakistani freelancers, influencers, YouTubers, and digital entrepreneurs receiving foreign payments through online platforms.
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