The Federal Board of Revenue (FBR) is drafting two major proposals for the upcoming 2025–26 federal budget, aiming to broaden the tax base and ease the burden on lower-income earners. Both proposals are expected to be submitted to the prime minister for review in the coming weeks.
The first recommendation involves introducing a nominal tax on large pensions. Initially, this measure would focus on high-level retirees, such as Grade-22 officials, by applying a 2.5% tax on monthly pensions exceeding Rs400,000 — equivalent to Rs4.8 million annually. The proposed levy is intended to target those leading affluent lifestyles while drawing substantial post-retirement benefits, leaving modest pensioners unaffected.
A former FBR tax policy official noted that such a move would require a political consensus, as it would touch on sensitive segments of retired public service elites, including members of the judiciary, senior bureaucrats, and armed forces officers.
The second proposal recommends an upward revision of the current income tax exemption threshold, which stands at Rs600,000 under the Income Tax Ordinance, 2001. If approved, the increase would offer relief to a broad section of the population by shielding more low-income earners from direct taxation.
The FBR’s efforts reflect a broader push to enhance tax fairness while addressing economic pressures on ordinary citizens.
Dubai has long been a favourite destination for people from Pakistan, offering a vibrant mix…
Marking World Environment Day, Bank Alfalah, in collaboration with the Pakistan Air Quality Initiative (PAQI)…
Karachi has been rattled by a series of low-intensity earthquakes over the past two days,…
No one likes standing in long lines, filling endless forms, or waiting days for a…
The federal government is reviewing a series of relief proposals aimed at easing financial pressure…
Emirates, the world's largest international airline, has signed a Memorandum of Understanding (MOU) with the…
This website uses cookies.