The government of Pakistan is considering a significant tax relief package for salaried individuals, which includes a proposal to reduce the maximum income tax rate by 5 per cent, bringing it down to 30 per cent.
Prime Minister Shehbaz Sharif has reportedly given in-principle approval to the plan. The proposal also suggests the potential abolition of the super tax currently imposed on wealthy individuals and the corporate sector.
The government intends to seek formal approval from the International Monetary Fund (IMF) before implementing these measures. These proposals were reviewed during a high-level meeting chaired by the Prime Minister, where officials discussed various reforms scheduled for presentation to the IMF next week.
Under the proposed plan, the highest tax bracket for high-income salaried individuals would be lowered to 30 per cent, and income slabs are expected to be adjusted accordingly. Officials informed the meeting that ending the super tax on affluent individuals and companies is being considered as part of a broader tax reform strategy.
The Prime Minister has directed authorities to refine these proposals further in consultation with private sector experts before they are submitted to the IMF. Sources indicate that while the government is considering tax reductions valued between Rs1.5 trillion and Rs1.8 trillion, there are concerns that the IMF may be reluctant to approve such a substantial fiscal relief package.
