Pakistan, April 12 -- The Punjab government has taken a strong step toward improving tax collection by allowing private companies to deduct income tax directly from employees' salaries. The Punjab Assembly's Standing Committee on Excise has approved The Punjab Finance (Amendment) Bill 2025, which now awaits final approval in a formal assembly session.

Once passed, the law will authorize Drawing and Disbursing Officers (DDOs) in private companies to withhold income tax before paying salaries. This move is expected to reduce underreporting of income and tackle tax evasion among salaried professionals in the private sector. It also shifts some responsibility for tax compliance from employees to their employers.

The bill clearly states that...