The coalition government, in the federal budget for 2023-24, has proposed to keep the tax rates and income tax slabs unchanged for the next fiscal year. The Shehbaz Sharif-led government avoided putting an extra burden on the salaried class and made no change in the tax slabs, which remained the same as approved last year in the Finance Bill 2022.
The tax slabs for the upcoming year are as follows:
- For income below Rs600,000 per year (Rs50,000 per month) — no tax will be deducted.
- Those earning Rs600,000 to Rs1.2 million per year (Rs50,000 to Rs100,000 per month) will pay a tax of 2.5% of the amount exceeding Rs600,000.
- On the income within a range of Rs1.2 million to Rs2.4 million (Rs100,000 to Rs200,000 per month), individuals will pay Rs15,000 plus 12.5% of the amount exceeding Rs1.2 million.
- Individuals earning Rs2.4 million to Rs3.6 million a year (Rs200,000 to Rs300,000 per month) will be charged at Rs165,000 plus 20% of the amount exceeding Rs2.4 million.
- Those earning Rs3.6 million to Rs6 million a year (Rs300,000 to Rs500,000 per month) will be charged at Rs405,000 plus 25% of the amount exceeding Rs3.6 million.
- People with an annual income of Rs6 million to Rs12 million (Rs500,000 to 1,000,000 per month) will be charged at Rs1.005 million plus 32.5% of the amount exceeding Rs6 million.
- In the highest income slab, individuals earning more than Rs12 million (more than Rs1,000,000 per month) a year will be charged at Rs2.955 million plus 35% of the amount exceeding Rs12 million.
This decision by the government aims to provide stability and relief to the taxpayers. By keeping the tax rates and slabs unchanged, it ensures predictability and allows individuals to plan their finances accordingly.
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