The upcoming federal budget for 2025-26 is set to bring relief to Pakistan’s salaried class through reduced income tax rates, starting from July 1, 2025, according to senior sources.
Individuals earning up to Rs. 600,000 annually will continue to enjoy full tax exemption, maintaining protection for the lowest income bracket.
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For those with taxable incomes above Rs. 600,000, revised tax slabs will apply:
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Rs. 600,000 – Rs. 1,200,000: Tax rate reduced by 4%
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Rs. 1,200,000 – Rs. 2,200,000: Tax rate reduced by 3%
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Rs. 2,200,000 – Rs. 3,200,000: Tax rate reduced by 2.5%
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Rs. 3,200,000 – Rs. 4,100,000: Tax rate reduced by 2%
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Above Rs. 4,100,000: Tax rate reduced by 1.5%
These reductions are designed to provide relief across the income spectrum, especially to middle-income earners, and form part of the government’s broader effort to ease the financial burden on salaried individuals while encouraging compliance and boosting disposable income.
