ISLAMABAD: The government has introduced revised income tax slabs for salaried individuals in the new Finance Bill, which is set to take effect from first July.
According to the final draft of the Finance Bill, which is scheduled to be presented in the National Assembly for approval, the new tax structure aims to revise tax rates across various income brackets while providing relief to lower-income earners.
Under the proposed tax regime, individuals earning up to Rs600,000 annually will remain exempt from income tax.
Salaried employees with annual incomes between Rs600,000 and Rs1.2 million will be subject to a 1 percent tax rate.
Those earning between Rs1.2 million and Rs2.2 million annually will pay a fixed tax of Rs6,000, along with 11 percent tax on the amount exceeding Rs1.2 million.
For individuals earning between Rs2.2 million and Rs3.2 million per year, the tax liability will consist of a fixed amount of Rs116,000 plus 20 percent on the income exceeding Rs2.2 million, reduced from the previous rate of 23 percent.
The Finance Bill further proposes a fixed tax of Rs346,000 plus 25 percent on the amount exceeding Rs3.2 million for annual incomes ranging from Rs3.2 million to Rs4.1 million.
Individuals earning between Rs4.1 million and Rs5.6 million annually will pay Rs541,000 in fixed tax, in addition to 29 percent on income exceeding Rs4.1 million.
For annual incomes between Rs5.6 million and Rs7 million, the tax liability will be Rs976,000 plus 32 percent on the amount above Rs5.6 million.
Meanwhile, individuals earning more than Rs7 million annually will be required to pay a fixed tax of Rs1.424 million, along with 35 percent tax on income exceeding Rs7 million.
The revised tax slabs are expected to come into force from July 1 as part of the government’s fiscal measures for the upcoming financial year.
Read also: Finance Bill 2026–27: New Income Tax Slabs for Salaried Individuals Revealed
