Pakistan’s power distribution companies collected more than Rs. 700 billion in taxes through electricity bills during the 2024–25 fiscal year, underlining the rising tax burden on electricity consumers across the country.
The latest official figures show that electricity bills have increasingly become a key channel for tax collection, with multiple federal and provincial levies embedded in monthly charges paid by households and businesses.
LESCO tops tax collection list
The Lahore Electric Supply Company emerged as the largest tax collector among all distribution companies. During the current fiscal year, LESCO collected more than Rs. 198 billion in taxes from consumers in Lahore and surrounding districts.
Officials said the high figure reflects both the size of LESCO’s consumer base and the concentration of commercial and industrial activity in the region. Lahore remains one of Pakistan’s largest electricity markets, with heavy usage by factories, offices, and urban households.
Multan and Faisalabad follow
The Multan Electric Power Company ranked second after collecting around Rs. 118 billion in taxes. It was followed closely by the Faisalabad Electric Supply Company, which generated approximately Rs. 112 billion in tax revenue during the same period.
Faisalabad, often referred to as Pakistan’s textile hub, accounts for a significant share of industrial electricity consumption. Analysts say this explains the consistently high tax recovery through electricity bills in the region.
Islamabad and regional utilities
In the federal capital and nearby areas, the Islamabad Electric Supply Company collected about Rs. 87.63 billion in taxes. The figure highlights the heavy reliance on electricity-based taxation even in relatively smaller but higher-income consumer regions.
Among other distribution companies, the Peshawar Electric Supply Company collected more than Rs. 50 billion, while the Hyderabad Electric Supply Company generated around Rs. 20 billion in tax revenue.
Sharp drop at TESCO
At the lower end of the spectrum, the Tribal Electric Supply Company recorded a sharp decline in collections. TESCO managed to recover only Rs. 190 million in taxes during the fiscal year, reflecting structural challenges, lower demand, and persistent recovery issues in its service areas.
Energy sector experts note that wide disparities in tax collection among power companies point to uneven economic activity and varying enforcement capacity across regions.
Growing burden on consumers
Electricity bills in Pakistan include multiple taxes such as sales tax, electricity duty, and income tax surcharges. With tariffs already elevated due to fuel costs and currency pressures, consumers have increasingly complained that electricity bills are being used as a primary tax collection tool.
Economists warn that continued reliance on electricity-based taxation could further strain households and small businesses, particularly in urban centres where consumption levels are higher.
The figures have renewed debate over the sustainability of using utility bills to bridge revenue gaps, as policymakers weigh fiscal needs against growing public pressure over energy affordability.
