Budget 2026-27: No relief for low-income class, education and health underfund

The Federal Budget 2026-27 offered little comfort to those most affected by the current skyrocketing inflation in Pakistan, which affects the lower and middle classes most. Despite promises of relief, low-income salaried workers have been largely ignored. Meanwhile, spending on essential sectors such as health and education remains excessively low.

There is no tax relief announced for low-income salaried individuals. However, tax relief has been announced for higher-income salary brackets.

Presenting the Federal Budget 2026-27 in the National Assembly of Pakistan, Minister for Finance, Muhammad Aurangzeb, has announced immense relief for the salaried class earning between Rs. 2.2 million to Rs. 7 million annually.

The tax relief rate ranges from 20 percent to 32 percent, depending on the income slab.

The Federal Finance Minister has also announced that the government is abolishing the long-standing surcharge imposed on salaried taxpayers.

He noted that the surcharge had been reduced from 10 percent to 9 percent in the previous budget and would now be removed completely.

On the other hand, the Minister for Finance of Pakistan has announced a token increase of 10 percent in the minimum wage, which is around Rs. 3,000 to Rs. 4,000 per month as part of the Budget 2026-27.

In addition, the government has also announced a seven percent increase in salaries and pensions of government employees.

In the federal Budget 2026-27, Rs. 94.3 billion has been earmarked for higher education, the Danish Schools Program, and the school and college education sector, including the early childhood training program.

In comparison, Rs. 838 billion has been allocated to the charity-based Benazir Income Support Program (BISP) alone.

Meanwhile, only Rs. 25.1 billion has been allocated for the health sector in the Budget 2026-27.

Education and Health once again neglected, low-income class dreams yet to become reality