Islamabad, 1 May, 2025: Tax relief for salaried class may be included in Pakistan’s federal budget for the fiscal year 2025–26, pending approval from the International Monetary Fund (IMF), according to officials familiar with the matter.
The Federal Board of Revenue (FBR) is reportedly drafting measures to ease the burden on middle-income earners, as the country prepares to present a fresh fiscal plan under the oversight of international lenders.
A delegation from the IMF is expected to arrive in Islamabad in the second week of May 2025 to evaluate proposed revenue measures and fiscal strategies.
The global lender’s feedback will play a crucial role in shaping any potential concessions, including those for salaried individuals.
Meanwhile, the government has postponed the introduction of a contentious amendment to existing tax legislation.
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The now-delayed Tax Laws Amendment Bill sought to bar the purchase of property exceeding Rs10 million without declared income.
That provision has been shelved until the next fiscal cycle, giving policymakers more time to refine the measure.
A parliamentary sub-committee has also advised shifting the decision-making authority on transaction limits from the FBR to the federal cabinet.
This move is expected to provide more flexibility in aligning future tax policy with broader economic goals.
The current draft of the legislation includes exemptions aimed at supporting low- and middle-income segments of society.
However, a proposal put forward by real estate representatives to raise the non-declaration cap to Rs50 million was dismissed by lawmakers.
The updated version of the bill is now expected to be incorporated into the main Finance Bill for 2025.
In a related development, the Pakistan Dairy Association has appealed to the government to reduce the sales tax on packaged and powdered milk from the current 18% to just 5%.
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The association warned of declining sales reporting a 20% drop and highlighted a significant shift toward unregulated loose milk, which has led to estimated tax losses of Rs1.3 trillion to the national exchequer.
If endorsed by the IMF, tax relief for salaried class could serve as a key budgetary reform, offering financial respite to millions of wage earners while aligning with broader efforts to improve tax compliance and economic transparency.
