The Salaried Class Alliance of Pakistan (SCAP) has urged the government to provide immediate relief to salaried individuals in the forthcoming budget, highlighting the heavy tax burden, rising inflation, and deteriorating economic conditions they face.

In a statement, SCAP noted that salaried employees—including government workers, private sector staff, and professionals in media, banking, education, and corporate sectors—are the only group paying their fair share of income tax in Pakistan without any exemptions.

Despite this, they have suffered under recent fiscal measures such as increased tax slabs and a 10% surcharge on higher incomes introduced in the last budget. SCAP warned, “The middle class has been crushed. Inflation has doubled in three years, yet the minimum taxable income threshold remains fixed at Rs. 50,000 per month.”

The Alliance cautioned that ignoring this group is worsening Pakistan’s brain drain, with emigration of skilled professionals rising by 119% last year, largely due to high taxation.

READ MORE:

Pakistani Tech Company DPL IT Ranked Among Newsweek’s Global Top 100 Most Loved Workplaces 2025

SCAP also highlighted structural tax disparities:

• Salaried individuals are expected to pay over Rs. 550 billion in taxes in FY2025, while exporters and retailers contribute only Rs. 100 billion combined.

• The agriculture sector, responsible for nearly 20% of GDP, contributes less than 1% in tax revenue.

• Privileged groups and landlords benefit from large exemptions, whereas salaried workers face tax rates up to 35%, plus an additional 10% surcharge.

The Alliance also expressed concern over the growing informal economy, where businesses pay salaries in cash to avoid tax deductions, harming documentation and economic growth.

SCAP’s Key Demands:

• Increase the minimum taxable income threshold to Rs. 100,000 per month.

• Roll back tax rates to FY22 levels.

• Cut government spending to support tax relief for salaried taxpayers.

• Remove the 10% surcharge, which they describe as an unfair penalty on compliant taxpayers.

• Reinstate tax credits immediately for the salaried class.

• Expand the tax base by including untaxed sectors like agriculture and informal businesses.

SCAP stressed that fair taxation is vital for economic justice, curbing the brain drain, and fostering sustainable development.