ISLAMABAD: Finance Minister Muhammad Aurangzeb is addressing a post-budget presser to expand on the government’s objectives and other key details for the upcoming Fiscal Year 20258-26 (FY26).
The press conference comes a day after Prime Minister Shehbaz Sharif’s government tabled its Rs17.57 trillion budget for FY26 setting a 4.2% GDP growth target and announcing relief measures for the salaried class while overall federal expenditure being slashed by 7%.
Projecting a deficit of 3.9% of the GDP, the budget expects inflation to be at 7.5% in the next fiscal year. Suggesting a 20.2% hike in the defence expenditure to Rs2,550 billion, the budget sets out an 18% more tax collection target of Rs14,131 billion — reflecting a 1.6% rise in tax-to-GDP ratio to 10.1%.
It also proposes new tax slabs for the salaried class — which has borne the brunt of the tax burden — with the minimum rate reduced to 4% from the existing 15% for taxpayers earning up to Rs2.2 million annually.
The tax rate for individuals making between Rs600,000 and Rs1.2 million a year will drop from 5% to 2.5%.
Also, it suggests strict measures against non-filers to increase Pakistan’s tax net which, if approved, will leave non-filers locked out of the country’s financial system.
This is a developing story and is being updated with more details.
