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Wednesday, July 17, 2024  
10 Muharram 1446  

Salaried class braces for impact as govt imposes higher income taxes

Decision will be effective for salary payable on or after July 1 2024
A money changer counts Pakistani Rupee notes in Karachi. Reuters/File
A money changer counts Pakistani Rupee notes in Karachi. Reuters/File

In a move that will impact the salaried class, the government has imposed a higher income tax rate of up to 35 per cent in the budget 2024-25, Business Recorder reported.

According to the budget documents, the new income tax slabs for the salaried class will be applicable from the tax year 2024, effective for salaries payable on or after July 1, 2024, in cases where the annual salary exceeds Rs600,000.

For salaried taxpayers earning up to Rs600,000 per year, there would be no change, as the income bracket would remain at a zero per cent tax rate.

But many experts believe that it would directly impact the take-home pay of the inflation-burdened salaried class.

They believe that the government has failed to tax the rich, who have been benefiting from the tax exemptions and low taxes.

The federal government has increased the income tax rate for people earning Rs100,000 or above per month in the federal budget for the fiscal year 2024-25.

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The tax rate has increased from 2.5% to 5% for those earning between Rs600,000 and Rs1,200,000 per annum.

The government maintained the tax slabs to six, as the tax burden continues to increase on the inflation-burdened salaried class.

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Income Tax