As per details, the final phase of budget negotiations between Pakistan and the International Monetary Fund (IMF) is underway.
Prime Minister Shehbaz Sharif had earlier directed that relief measures be introduced for salaried individuals. According to a briefing given to the prime minister, the government collected more tax than anticipated from the salaried segment during the current fiscal year.
Sources indicate that income tax relief of 2.5% could be provided across all income slabs for salaried employees. Additionally, similar tax rate reductions are being considered for the corporate sector, while the Prime Minister has also instructed a 0.5% reduction in the super tax.
There is a strong possibility that annual income up to Rs1 million (approx. Rs83,000 per month) may be declared tax-exempt, increasing the current exemption threshold from Rs600,000 annually.
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According to new proposals for the salaried class, the income tax ratio will be brought to 2.5 per cent from 5pc for individuals earning Rs100,000 per month.
Individuals earning Rs183,000 per month will likely pay income tax up to 12.5 per cent in the new budget proposals.
The income tax ratio will be brought down to 22.5pc fromthe current 25pc for the salaried individuals slab of Rs267,000.
The proposals are expected to be discussed in detail with the IMF as part of the ongoing talks for the upcoming budget.
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