KARACHI – Pakistan’s federal government has unveiled budget 2024-25, with major changes in income tax for inflation-hit people.
The country’s finance czar outlined proposed changes, calling income tax reforms as need of the hour. Muhammad Aurangzeb highlighted Federal Board of Revenue’s (FBR) recent implementation of income tax reforms and proposed maintaining income tax exemption for incomes up to Rs 600,000 annually.
He also suggested not increasing maximum tax rate for the salaried class while introducing changes to the tax brackets.
| Annual Income Range | Monthly Income | Previous Monthly Tax | New Monthly Tax |
| Rs600,000 – Rs1,200,000 | Rs100,000 | Rs1,250 | Rs2,500 |
| Rs1,200,000 – Rs2,200,000 | Rs183,000 | Rs11,650 | Rs15,000 |
| Rs2,200,000 – Rs3,200,000 | Rs267,500 | Rs28,750 | Rs35,834 |
For non-salaried individuals, the maximum tax rate is proposed to be set at 45%
Pakistan’s Budget 2024-25
The federal budget was presented with outlay of Rs18.9 trillion, and targets of 3.6pc GDP growth and Rs13 trillion in tax revenue. Key highlights include significant tax reforms, increased petroleum levies, and zero-rated imports for solar panel materials.
The budget aims to broaden the tax base, reduce inflation to 12pc, and boost foreign investment. The Public Sector Development Programme (PSDP) received a substantial increase, reflecting the government’s focus on economic development and fiscal consolidation.
Finance Minister praised the government’s efforts in securing an IMF programme and called for privatization and regulatory reforms to sustain economic growth.
