During a tumultuous session of the National Assembly, Finance Minister Senator Muhammad Aurangzeb unveiled Pakistan’s budget for the 2024-25 fiscal year. Amidst opposition uproar, the 60-year-old minister outlined significant financial measures aimed at bolstering the country’s economy.
A key feature of the budget is the ambitious tax target of Rs12.97 trillion, marking a 38% surge from the previous fiscal year. This aggressive goal forms part of the government’s strategy to secure a vital bailout package from the International Monetary Fund (IMF). Despite facing formidable financial and political hurdles in the past year, Aurangzeb asserted that the government has made substantial economic strides.
The new income tax slabs for the fiscal year 2024-25 are designed to levy higher taxes on high-income earners, both salaried and non-salaried individuals. Here’s a breakdown of the revised tax structure:
- Individuals earning up to Rs600,000 will be exempt from taxation.
- Those with incomes between Rs600,000 and Rs1,200,000 will incur a 15% tax on the amount exceeding Rs600,000.
- Incomes ranging from Rs1,200,000 to Rs1,600,000 will be taxed at Rs90,000 plus 20% of the amount exceeding Rs1,200,000.
- Earnings between Rs1,600,000 and Rs3,600,000 will attract a tax of Rs170,000 plus 30% of the amount exceeding Rs1,600,000.
- For incomes between Rs3,600,000 and Rs5,600,000, the tax will be Rs650,000 plus 40% of the amount exceeding Rs3,600,000.
- Individuals earning over Rs5,600,000 will face a tax of Rs1,610,000 plus 45% of the amount exceeding Rs5,600,000.
These measures are intended to augment revenue collection to meet the ambitious tax target and fortify economic stability. By imposing higher taxes on affluent earners, the government aims to achieve budgetary equilibrium and secure the IMF bailout crucial for sustaining economic advancement.