Revised Income Tax Slabs for Salaried Individuals Announced in Draft Finance Bill 2025-26
ISLAMABAD: The draft of the amended Finance Bill for the 2025-26 budget introduces updated income tax slabs for salaried individuals, aiming to provide relief to taxpayers while ensuring a fair tax system.
According to the draft bill, six new income tax slabs have been proposed for salaried earners:
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No tax for individuals earning up to Rs600,000 annually.
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A 1% tax on income exceeding Rs600,000 for those earning between Rs600,001 and Rs1.2 million.
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For incomes between Rs1.2 million and Rs2.2 million, a fixed tax of Rs6,000 plus 11% tax on the amount exceeding Rs1.2 million will apply.
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Salaried individuals earning between Rs2.2 million and Rs3.2 million will pay a fixed tax of Rs116,000 plus 23% tax on income above Rs2.2 million.
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Those with annual incomes between Rs3.2 million and Rs4.1 million will be liable for a fixed tax of Rs346,000 plus 30% tax on the amount exceeding Rs3.2 million.
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For individuals earning above Rs4.1 million, the tax will be a fixed amount of Rs616,000 plus 35% tax on the income exceeding Rs4.1 million.
This revised tax structure is designed to offer significant relief to low and middle-income salaried taxpayers while adjusting rates for higher earners.
The Finance Bill is currently under review and will be presented in the upcoming budget session.
