The Federal Board of Revenue (FBR) has unveiled the tax structure for salaried individuals for the 2024-25 tax year, providing significant relief to low-income earners. Salaries of up to Rs600,000 annually (or Rs50,000 monthly) will now be exempt from income tax, a measure aimed at easing the burden on lower-income groups.
For those earning over Rs600,000 annually, a 5% income tax will apply, while individuals with a salary of Rs1 million per year will face an annual tax of Rs20,000.
A fixed tax of Rs30,000 will be imposed on those earning between Rs1.2 million and Rs2.2 million, with an additional 15% tax on income above Rs1.2 million.
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For salaries between Rs2.2 million and Rs3.2 million, a fixed tax of Rs180,000 will be charged, with an additional 25% tax on income exceeding Rs2.2 million.
Those earning Rs3.2 million to Rs4.1 million annually will pay a fixed tax of Rs430,000, plus a 30% tax on any income above Rs3.2 million.
High-income earners, making over Rs4.1 million per year, will face a fixed tax of Rs700,000, with an additional 35% tax on any income exceeding that amount. Employers are required to deduct applicable taxes before processing salaries. The new tax card is expected to simplify tax collection and offer some relief to lower-income earners.
