ISLAMABAD: The Federal Government is considering income tax relief measures for salaried individuals to ease financial burdens.
Prime Minister Shehbaz Sharif has directed the economic team to review current income tax rates for those earning up to Rs100,000 per month.
In the latest budget, a 2.5% tax was imposed on monthly salaries within this bracket. However, under the Finance Bill 2024, the tax rate for salaries between Rs50,000 and Rs100,000 has been proposed to increase from 2.5% to 5% on income exceeding Rs50,000.
Additionally, individuals earning between Rs100,000 and Rs200,000 will face a tax rate of 15% on income above Rs100,000, alongside a fixed annual sum of Rs30,000, up from Rs15,000 previously.
The coalition government is exploring options to potentially reduce or eliminate the tax for those earning up to Rs100,000 per month to alleviate financial pressure.
Implementing such relief could lead to an estimated Rs40 billion revenue shortfall, which may be offset by reducing allocations to the Public Sector Development Programme (PSDP).
The proposed relief measures will also be discussed with the International Monetary Fund (IMF).
