The National Assembly on Tuesday approved the federal budget for the 2026-27 fiscal year, with a total outlay of Rs18.771 trillion aimed at boosting economic growth and providing tax relief to key sectors.

Finance Minister Muhammad Aurangzeb moved the motion for the passage of the budget, which was approved by the lower house along with the Finance Bill 2026, incorporating a number of amendments.

The budget, which will take effect from July 1, projects economic growth of 4% and inflation at 8.2% during the next financial year.

The government has set a tax-collection target of Rs15.264 trillion for Federal Board of Revenue (FBR) collections, while non-tax revenues are estimated at Rs5.336 trillion.

An allocation of Rs1 trillion has been earmarked for the federal Public Sector Development Programme (PSDP), while Rs838 billion has been set aside for the Benazir Income Support Programme (BISP).

More than 60% of the PSDP allocation has been directed towards the transport and communications, water resources and energy sectors.

The remaining funds will be distributed among other sectors, including higher education, agriculture, health and information technology.

New tax measures, including revised income tax slabs, advance taxes on property transactions and a withholding tax on earnings generated through social media platforms, have also been introduced under the bill.

Individuals earning up to Rs600,000 annually will remain exempt from income tax, while new tax slabs have been introduced for higher income brackets.

Under the bill, an advance tax has been imposed on the purchase and sale of property.

A 5% withholding tax on income earned through social media platforms has been imposed under the bill.

It revises duty rates on imported vehicles and electric vehicles.

To strengthen the FBR’s electronic tax monitoring system, the bill introduces tougher penalties for those who fail to comply with tax notices.

Under the new rules, all taxpayers will be required to file their income tax returns electronically from July 1.

The budget also includes relief measures for the salaried class and incentives for the agriculture, construction and export sectors.

Following the passage of the budget and the Finance Bill, the National Assembly was adjourned until 11am on Wednesday.