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ISLAMABAD: The government on Friday dismissed a widely held perception that salaried workers bear a disproportionate share of the tax burden, saying the salaried class contributed only about 5 percent of total revenues in the last fiscal year and that income-tax rates for middle- and higher-income earners were cut in the latest budget.

The remarks by Khurram Schehzad, adviser to the finance minister, come amid public concern over shrinking disposable incomes and the government’s efforts to meet ambitious revenue-generation targets of Rs 14.13 trillion ($50.7 billion) under a $7 billion International Monetary Fund (IMF) loan program.

“During the last fiscal year, the salaried class contributed about 5 percent of total FBR revenues, and roughly 4 percent of total federal income,” Schehzad said in a social media post, referring to the Federal Board of Revenue.

“Last year, the salaried class paid Rs 555 billion [$2 billion] in taxes, while wholesalers, retailers and traders contributed nearly Rs 700 billion [$2.5 billion] (Rs 693 billion [$2.48 billion]), which was a 100 percent increase from the previous year,” he added. “These are verified, official figures.”

Schehzad said around 600,000 individuals in Pakistan fell in the salaried class.

He added that for those earning about Rs 600,000 ($2,155) a month, the income tax rate was reduced from 5 percent to 1 percent.

For individuals earning between Rs 250,000 ($889) and Rs 300,000 ($1,078) a month, it was lowered from 15 percent to 13 percent.

Similarly, those earning around Rs 250,000 are now required to pay 23 percent tax, down from 25 percent previously.

Pakistan has sought to modernize its revenue-collection system through automation, with the FBR integrating artificial intelligence to detect misreporting and curb tax evasion.

The country’s tax-to-GDP ratio remains among the lowest in South Asia, about 10.6 percent in fiscal year 2024-25, below the 13 percent target set under the IMF program.

“The government is not targeting anyone,” Schehzad said. “We no longer have the luxury of avoiding tough decisions. We must do what’s right for the country’s long-term interest.” 

HANOI: Countries signed their first UN treaty targeting cybercrime in Hanoi on Saturday, despite opposition from an unlikely band of tech companies and rights groups warning of expanded state surveillance.

The new global legal framework aims to strengthen international cooperation to fight digital crimes, from child pornography to transnational cyberscams and money laundering.

More than 60 countries were seen to sign the declaration Saturday, which means it will go into force once ratified by those states.

UN Secretary General Antonio Guterres described the signing as an “important milestone,” but that it was “only the beginning.”

“Every day, sophisticated scams, destroy families, steal migrants and drain billions of dollars from our economy... We need a strong, connected global response,” he said at the opening ceremony in Vietnam’s capital on Saturday.

The UN Convention against Cybercrime was first proposed by Russian diplomats in 2017, and approved by consensus last year after lengthy negotiations.

Critics say its broad language could lead to abuses of power and enable the cross-border repression of government critics.

“There were multiple concerns raised throughout the negotiation of the treaty around how it actually ends up compelling companies to share data,” said Sabhanaz Rashid Diya, founder of the Tech Global Institute think tank.

“It’s almost rubber-stamping a very problematic practice that has been used against journalists and in authoritarian countries,” she told AFP.

‘WEAK’ SAFEGUARDS

Vietnam’s government said this week that 60 countries were registered for the official signing, without disclosing which ones.

But the list will probably not be limited to Russia, China, and their allies.

“Cybercrime is a real issue across the world,” Diya said. “I think everybody’s kind of grappling with it.”

The far-reaching online scam industry, for example, has ballooned in Southeast Asia in recent years, with thousands of scammers estimated to be involved and victims worldwide conned out of billions of dollars annually.

“Even for the most democratic states, I think they need some degree of access to data that they’re not getting under existing mechanisms,” Diya told AFP.

Democratic countries might describe the UN convention as a “compromise document,” as it contains some human rights provisions, she added.

But these safeguards were slammed as “weak” in a letter signed by more than a dozen rights groups and other organizations.

TECH SECTOR

Big technology companies have also raised concerns.

The Cybersecurity Tech Accord delegation to the treaty talks, representing more than 160 firms including Meta, Dell and India’s Infosys, will not be present in Hanoi, its head Nick Ashton-Hart said.

Among other objections, those companies previously warned that the convention could criminalize cybersecurity researchers and “allows states to cooperate on almost any criminal act they choose.”

Potential overreach by authorities poses “serious risks to corporate IT systems relied upon by billions of people every day,” they said during the negotiation process.

In contrast, an existing international accord, the Budapest Convention on Cybercrime, includes guidance on using it in a “rights-respecting” way, Ashton-Hart said.

The location for the signing has also raised eyebrows, given Vietnam’s record of crackdowns on dissent.

“Vietnamese authorities typically use laws to censor and silence any online expression of views critical of the country’s political leadership,” said Deborah Brown of Human Rights Watch.

“Russia has been a driving force behind this treaty and will certainly be pleased once it’s signed,” she told AFP.

“But a significant amount of cybercrime globally comes from Russia, and it has never needed a treaty to tackle cybercrime from within its borders,” Brown added.

“This treaty can’t make up Russia’s lack of political will in that regard.”