The Pakistani government regularly updates income tax rates to align with fiscal policies and economic conditions. The Finance Act 2024, effective July 1, 2024, introduces significant changes, particularly impacting middle and high-income earners. This guide provides a detailed breakdown of salary tax slabs from 2021 to 2025, offering insights into tax trends and their implications for salaried individuals.
Salary Tax Slabs for FY 2024-25
The Finance Act 2024 has introduced revised tax slabs for salaried individuals in Pakistan, impacting different income groups. Below are the updated tax slab for salaried person in Pakistan for 2025 effective from July 1, 2024 – June 30, 2025:
| Annual Salary (PKR) | Applicable Tax Rate |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 5% of the amount exceeding PKR 600,000 |
| 1,200,001 – 2,200,000 | PKR 30,000 + 15% of the amount exceeding PKR 1,200,000 |
| 2,200,001 – 3,200,000 | PKR 180,000 + 25% of the amount exceeding PKR 2,200,000 |
| 3,200,001 – 4,100,000 | PKR 430,000 + 30% of the amount exceeding PKR 3,200,000 |
| Above 4,100,000 | PKR 700,000 + 35% of the amount exceeding PKR 4,100,000 |
These revised rates indicate a shift toward progressive taxation, where higher earners contribute more to tax revenue.
Between July 2024 and January 2025, income tax payments from salaried individuals reached a staggering Rs285 billion, a dramatic leap from the Rs185 billion collected during the same period last year. This Rs100 billion year-on-year increase represents a 53% jump. Salaried Class Bears Rs100 Billion in 7 Months.
Comparison of Income Tax Rates (2021–2025)
A historical comparison of income tax rates from 2021 to 2025 reveals key trends in Pakistan’s taxation policies. The following highlights key tax changes over the years:
Key Tax Changes Over the Years:
- 2024-25 vs. 2023-24: Increased tax burden for middle and high-income earners, with some rates rising by 5-10%. This shift aligns with the government’s goal of enhancing revenue collection while reducing the fiscal deficit.
- 2023-24 vs. 2022-23: Gradual increases in tax rates for higher-income groups aimed at maintaining progressive taxation.
- 2022-23 vs. 2021-22: Adjustments introduced in response to economic challenges, inflation, and revenue targets.
Below are the tax slabs for previous years to illustrate these changes:
Salary Tax Slabs for FY 2023-24
Below were the tax rates for salaried individuals for 2024 in Pakistan, from July 1, 2023 – June 30, 2024:
| Annual Salary (PKR) | Applicable Tax Rate |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 2.5% of the amount exceeding PKR 600,000 |
| 1,200,001 – 2,400,000 | PKR 15,000 + 12.5% of the amount exceeding PKR 1,200,000 |
| 2,400,001 – 3,600,000 | PKR 165,000 + 22.5% of the amount exceeding PKR 2,400,000 |
| 3,600,001 – 6,000,000 | PKR 435,000 + 27.5% of the amount exceeding PKR 3,600,000 |
| Above 6,000,000 | PKR 1,095,000 + 35% of the amount exceeding PKR 6,000,000 |
Salary Tax Slabs for FY 2022-23
Below were the salary tax slabs 2023 in Pakistan, effective from July 1, 2022 – June 30, 2023:
| Annual Salary (PKR) | Applicable Tax Rate |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 2.5% of the amount exceeding PKR 600,000 |
| 1,200,001 – 2,400,000 | PKR 15,000 + 12.5% of the amount exceeding PKR 1,200,000 |
| 2,400,001 – 3,600,000 | PKR 165,000 + 20% of the amount exceeding PKR 2,400,000 |
| 3,600,001 – 6,000,000 | PKR 405,000 + 25% of the amount exceeding PKR 3,600,000 |
| 6,000,001 – 12,000,000 | PKR 1,005,000 + 32.5% of the amount exceeding PKR 6,000,000 |
| Above 12,000,000 | PKR 2,955,000 + 35% of the amount exceeding PKR 12,000,000 |
Salary Tax Slabs for FY 2021-22
Below was salary tax 2022 in Pakistan, from July 1, 2021 – June 30, 2022:
| Annual Salary (PKR) | Applicable Tax Rate |
|---|---|
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 5% of the amount exceeding PKR 600,000 |
| 1,200,001 – 1,800,000 | PKR 30,000 + 10% of the amount exceeding PKR 1,200,000 |
| 1,800,001 – 2,500,000 | PKR 90,000 + 15% of the amount exceeding PKR 1,800,000 |
| 2,500,001 – 3,500,000 | PKR 195,000 + 17.5% of the amount exceeding PKR 2,500,000 |
| 3,500,001 – 5,000,000 | PKR 370,000 + 20% of the amount exceeding PKR 3,500,000 |
| 5,000,001 – 8,000,000 | PKR 670,000 + 22.5% of the amount exceeding PKR 5,000,000 |
| Above 8,000,000 | PKR 1,345,000 + 25% of the amount exceeding PKR 8,000,000 |
Free Salary Tax Calculator
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Key Taxation Trends & Insights
✅ Tax Exemption for Low-Income Earners: Individuals earning up to PKR 600,000 remain tax-free across all years.
✅ Higher Tax Burden on Higher Salaries: Increased tax rates impact those earning above PKR 1.2 million annually, particularly those in the upper-middle and high-income brackets.
✅ Shift Towards Progressive Taxation: The revised tax slabs indicate a clear government strategy to enhance progressive taxation, ensuring higher-income earners contribute more to revenue generation.
✅ Government’s Fiscal Strategy: A progressive tax structure aims to enhance revenue generation while maintaining relief for lower-income groups. The tax policy changes reflect efforts to balance economic stability, inflation control, and tax compliance.
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is there any difference on tax payable of a salaried persons filer and non filer??
Nope