Good news likely for salaried class in the next budget

ISLAMABAD: The Federal Board of Revenue (FBR) has drafted proposals to offer income tax relief for salaried individuals in the 2025–26 federal budget.

According to official sources, a high-level meeting was held at the FBR to review tax measures for the upcoming fiscal year.

During the meeting, three key proposals were finalised to ease the tax burden on salaried employees.

As per the plan, the annual income threshold for paying income tax, currently Rs 600,000, is likely to be raised. This move would provide relief to those earning slightly above the current exemption limit.

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The lower income tax slabs are also expected to be revised, allowing for adjustments in tax rates for different income brackets. One of the proposals includes providing tax exemptions for individuals earning slightly over Rs50,000 per month by widening the first tax slab.

Sources added that the relief plan remains subject to final approval by the International Monetary Fund (IMF), and the FBR will present its proposals to the Prime Minister before the final budget is announced.

In addition, the meeting discussed simplifying the income tax return filing process. The aim is to make the return forms more user-friendly and aligned with the revised tax slabs.

The government is currently under pressure to offer some relief to the middle class amid rising inflation, while also meeting revenue targets agreed with the IMF.