Tax Relief Proposed for Salaried Class in Budget 2025-26
Islamabad: Proposals to provide tax relief to the salaried class and reduce tax rates on income have been revealed in the federal budget for the upcoming fiscal year 2025-26.
The decisive round of virtual budget talks between the government and the International Monetary Fund (IMF) will be held today.
According to sources, the government is considering easing income tax slabs to provide relief to the salaried class. According to the proposed proposals:
Tax on monthly income of Rs 100,000 to be reduced from 5 percent to 2.5 percent
Tax on monthly income of Rs 183,000 to be reduced from 15 percent to 12.5 percent
Tax on monthly income of Rs 267,000 to be reduced from 25 percent to 22.5 percent
Tax on monthly income of Rs 333,000 to be reduced from 30 percent to 27.5 percent.
The budget also recommends major measures for the industrial and agricultural sectors.
Proposals include abolishing the Rs 200 billion withholding tax on raw materials for the manufacturing industry and reducing taxes on raw materials for the construction sector.
Similarly, a proposal to introduce loan schemes for small farmers is also under consideration.
Sources say that on the special instructions of the Prime Minister, a relief plan was prepared for various sectors, on which the IMF has been briefed.
The International Monetary Fund has responded positively to these proposals, however, a condition has been imposed that alternative revenue sources should also be presented in exchange for relief measures.
Last night, virtual talks were held between Pakistan and the IMF on budget targets, in which the economic team gave a briefing on alternative revenue sources. An attempt will be made to finalize these proposals in the talks to be held today.
