ISLAMABAD – The International Monetary Fund (IMF) has reportedly agreed to Pakistan’s key demand for providing tax relief to salaried class in upcoming Budget 2025-26.
Reports claimed that the government also achieved significant success regarding income tax relief in talks with the IMF. It has been decided that the tax rate will be reduced for all salary slabs in the next budget.
The Clause 129 of the Income Tax Act relates to income tax concessions, and the IMF has shown willingness to increase the annual tax-free income limit from Rs600,000.
In the upcoming budget, a monthly salary of Rs83,000 may become tax-free instead of the current Rs50,000.
Tax Slabs for Salaried Class
For a monthly salary of Rs100,000, the income tax rate may be reduced from 5% to 2.5%. For a monthly salary of Rs183,000, the tax rate may be reduced from 15% to 12.5%.
Similarly, for a monthly salary of Rs267,000, the income tax rate may decrease from 25% to 22.5%.
For a salary of up to Rs333,000, the rate may drop from 30% to 27.5%, and for salaries above Rs333,000, the tax rate may be reduced by 2.5%, bringing it to 32.5%.
The Pakistani authorities have assured the IMF that all remaining targets under loan deal will be met, and timely implementation will be ensured during the next economic review.
