In a bid to boost revenues, Islamabad has greenlighted a proposal to levy a tax on private academies and educational establishments operating online.

 

According to the Federal Board of Revenue's (FBR) Chairman Rashid Mehmood Langrial, online educational institutions are brining in upwards of Rs30 million per annum. Bringing these institutions into the tax net could boost revenue levels which is the primary motivation behind the move.

 

Reports indicate that aside from online academies, authorities will also pursue teachers offering their services to online teaching platforms to extract taxes from their revenues.

 

However, it is unclear how the government will levy taxes on teachers providing online educational services to students one-on-one as that is tough to track. Moreover, the move may push teachers working for educational platforms towards more traditional channels of providing their services such as one-on-one at-home teaching services. Critics have outlined how this could detrimentally impact educational outcomes in the country.

 

The federal government has also drawn much criticism from teachers because of concerns over the outlay for the Higher Education Commission (HEC) in the recently announced federal budget for fiscal year (FY) 2025-26. According to reports, teachers have outlined how Rs66.4 billion is not enough to cover the monetary requirements of institutions in the higher education space.

 

The HEC had requested a budget of Rs84.6 billion, however, the government was unable to meet this demand. This has resulted in a gap of approximately 21.5 percent between the initially requested amount and the actual allocation. It merits a mention that the allocated amount for the HEC is to cover all “non-development” expenses, including the salaries and pensions for staff. 

 

Reports reveal that the government has actually slashed development budgets, causing the outlay for development initiatives in the educational sector to fall to just Rs39.4 billion for FY 2025-26. This is a sharp drop in comparison to the development outlay for FY 2024-25, which stood at a respectable Rs65 billion. 

 

Reports indicate that the low amount earmarked for the HEC comes at a time when top-tier higher educational institutes such as Quaid-i-Azam University (QAU) are facing difficulties in covering financial liabilities. These liabilities include salaries and pensions.

 

According to reports, the financial situation of universities is especially grave in Balochistan and Khyber Pakhtunkhwa. The Information Secretary of the Federation of Pakistan Universities Academic Staff Association (FAPUASA) has reportedly highlighted that universities could face immense difficulties if budgets are not increased.