ISLAMABAD, June 3, 2025: The International Monetary Fund and federal government of Pakistan have agreed on reducing income tax percentages to provide relief to the salaried individuals.
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Sources said that the upcoming budget for fiscal year 2025-26 will offer notable decrease in the tax rates, while keeping the tax slabs constant.
Reportedly, the IMF has also agreed to the necessary increase in the defense budget as well, sources said. An agreement has also been expressed to make monthly salary up to Rs. 83,000 tax-free.
Moreover, there is a possibility of a 2.5% reduction in income tax for higher slabs as compared to the currently applicable taxes.
Tax on monthly salary of Rs. 100,000 is likely to be reduced from 5% to 2.5%, sources said, adding that income tax on Rs. 183,000 income slab is likely to be reduced from 15% to 12.5%.
On monthly salary of Rs. 267,000, the tax rate may be changed from 25% to 22.5%.
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Likewise, on salary up to Rs. 333,000, the tax rate may be 27.5% down from 30%.
According to sources, it has been agreed to make these changes by amendment to Section 129 of the Income Tax Act.
