Govt to Cut Income Tax Rates by 2.5 Pc

The government has announced plans to review the income tax rates for salaried individuals. Sources suggest that the 2.5% tax on monthly salaries up to 100,000 rupees may be partially or fully withdrawn. Prime Minister Shehbaz Sharif has tasked the economic team with overseeing this review.

The proposed tax relief is expected to reduce the financial burden on salaried individuals by 4 trillion rupees, with funding to be drawn from the development budget.

Additionally, the government is considering proposals to alleviate electricity bills for consumers using between 300 and 400 units, pending approval from the International Monetary Fund (IMF).

For the current fiscal year, the income tax rate for earnings between 600,000 and 1,200,000 rupees annually has been set at 5%, with a monthly tax of 5% on incomes up to 100,000 rupees. The monthly tax has increased from 1,250 to 2,500 rupees.