Budget 2025-26 Pakistan

Budget 2025-26 Pakistan has a new approach to enhance the nation economically and help its people. The new budget contains relief measures on the poor, higher development expenditure and aims at reducing the fiscal deficit. Some of the major areas that the government supports are agriculture, IT and small business. The budget also projects the initiatives to strengthen tax collection without additional burdening the middle-class. The Budget 2025-26 of Pakistan is going to empower the national economy with a clear vision to manage external debt levels and boost exports. It also introduces transparency and economy on the spending of the government money. In totality the budget is aimed to guarantee progress, stability and improved living standards to all Pakistanis in the year to come. Explore the main points of new budget and imposed taxes.

Salaries, Pensions & Tax Relief in Budget 2025-26

The Federal Budget 202526 provides direct relief to pensioners and salaried people. A 10 percent pay hike has been given to government workers and pensions have been improved by 7 percent. Notably, however, any pension under 10 million rupees per year is tax-exempt, and only brackets above that are subject to a 5-percent tax. In the case of salaried taxpayers, the income tax slabs have been altered, providing 1 percent tax rate on monthly income of 60,000-120,000, relieving the middle-income households. Also, high-income earners were to get a 1 percent cut in surcharge to ease compliance and encourage fairness.

Key Highlights of Pakistan Budget for 2025-26

Pakistan's Budget 2025-26 focuses on economic revival with increased development spending and strategic tax reforms. Here are the key highlights of Budget 2025-26.

Key Taxes on Goods & Energy

A number of new and modified taxes will apply to consumers and everyday spending. Fuel has received a 2.5 per liter carbon levy which has added to the transportation and production expenses. Solar panels that were previously exemption are now being charged 18 percent sales tax, likely to increase the cost of residential solar systems. There are also increased duties on the auto industry, with the tax waiver on cars below 850cc being revoked, and replaced with the standard 18% sales tax. These measures will have a minor impact on household budgets even though they are meant to increase revenue.

Property Sector & Investment Incentives Taxes Details

The current year budget has given some good reforms to the real estate and housing sector. Withholding tax on the transaction of properties has been lowered to 2.5 percent(was 4 percent), and federal excise duty on commercial property transfer has been removed. All these have been done to promote property investment and activate the construction sector. Also, home loan interest tax credits have been reinstated to individuals constructing or buying homes. These measures can improve the affordability of real estate to middle-income purchasers and investors next year.

Social Welfare, Subsidies & Development

The government is maintaining its aid to the vulnerable groups despite the fiscal tightening. The Benazir Income Support Programme (BISP) had its budget increased to 716 billion, and this guarantees support to low-income families. Subsidies on electricity to lifeline consumers who consume 50-100 units are still provided and subsidy on gas is given to households and to tandoors. An amount of 1 trillion has been allocated to the Public Sector Development Programme (PSDP) with emphasis on infrastructure, energy and regional uplift. These allocations show the government effort in balancing economic reform, population welfare and regional growth.

FAQs

Q1: Did government employees get a salary icrease?

Yes, government employees will get 10% more salary starting from July 2025.

Q2: Has the pension amount increased?

Yes, the pension has been increased by 7% for retired employees.

Q3: Is there any change in income tax for workers?

Yes, people earning between ₨50,000 to ₨100,000 per month will now pay less income tax — between 1% and 2.5% only.

Q4: What things will become more expensive now?

Some items that may cost more include:

• Petrol (new tax of ₨2.5 per litre)
• Solar panels (now taxed at 18%)
• Small cars (tax exemption removed)

Q5: What help is the government giving to poor families?

The government will give more support through the Benazir Income Support Programme with ₨716 billion. Subsidies on electricity and gas will also continue.