Budget 2024-25: How much income tax will be deducted from salaries?
- By Web Desk -
- Jun 12, 2024
In the budget for fiscal year 2024-25, the federal government has proposed exempting those earning up to Rs600,000 per year from paying income tax, ARY News reported on Wednesday.
Finance Minister Muhammad Aurangzeb outlined the proposed changes during the budget session in National Assembly (NA), emphasising the need for personal tax reforms.
During the speech, Aurangzeb announced that the new tax target was set to Rs 12.97 trillion, a 38pc high year-on-year basis.
He proposed maintaining the tax exemption on incomes up to Rs600,000 annually and suggested not increasing the maximum slab for the salaried class, while introducing changes to the tax slabs.
Income tax slabs 2024
- Those earning between Rs600,000 and Rs1.2 million annually will be taxed at 5pc of their income.
- A fixed tax of Rs30,000 will be imposed on individuals earning Rs2.2 million per annum, with an additional 10pc income tax on amounts exceeding Rs1 million.
- Individuals earning between Rs2.2 million and Rs3.2 million will be taxed at Rs1.8 lakh (fixed) + 25pc income tax on amounts exceeding Rs1 million.
- Those earning between Rs3.2 million and Rs4.1 million will be taxed at Rs4.3 lakh (fixed) + 30pc income tax on amounts exceeding Rs9 lakh.
- Individuals earning above Rs4.1 million will be taxed at Rs7 lakh (fixed) + 35pc income tax on the excess amount.
Finance Minister Aurangzeb presented the Rs18.877 trillion relief-oriented federal budget for the fiscal year 2024-25.
It is pertinent to mention here that Muhammad Aurangzeb proposed 20-25 percent increase in the salaries on ad-hoc basis and 15 percent enhancement in the pensions of the Federal Government employees.
The minister said despite financial constraints, the government had decided to give 25 percent ad-hoc relief in the salaries of employees from Grade1-16 and 20 percent to Grade-17-22 employees aimed at increasing their purchase power.
He also announced to increase the minimum wages from existing Rs 32000 to Rs 37000 per month.