The government is considering income tax relief for salaried citizens, which may amount to a substantial quantity of relief. Prime Minister Shehbaz Sharif directed the economic team to reconsider the present income tax rate on monthly income up to Rs 100,000. Under the newly presented budget, a 2.5% income tax rate was levied on these salaries.
This 2.5 percent tax rate is proposed to be totally or partially abolished with a view to providing relief to the salaried class. This measure of relief would cost an estimated Rs 40 billion, which the government intends to compensate by reducing the PSDP.
The proposal will also be discussed with the IMF as part of the government’s efforts to provide relief to the salaried class. Sources said that the initiative was still under consideration and would be taken up for further discussion before a final decision is made.
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