Income tax calculator after budget 2026-27
- By Fahad Ali -
- Jun 12, 2026
On Friday, Finance Minister Muhammad Aurangzeb laid out the Federal Budget 2026-27 before the National Assembly, announcing new income tax changes targeting salaried people.
Speaking during the budget session, he said the government is offering tax relief across four income brackets for salaried individuals and plans to scrap the surcharge on their salaries.
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Salaried people making between Rs2.2 million and Rs3.2 million per year would see their marginal tax rate drop from 23% to 20%. As per the Finance Bill, they’d pay Rs116,000 plus 20% on anything above Rs2.2 million.
For those in the Rs3.2 million to Rs4.1 million bracket, the marginal rate is set to fall from 30% to 25%. The tax proposed is Rs316,000 plus 25% of the income over Rs3.2 million.
Salaried earners between Rs4.1 million and Rs5.6 million would have their rate cut from 35% to 29%. Under the plan, they’d owe Rs541,000 plus 29% on the portion exceeding Rs4.1 million.
And for incomes between Rs5.6 million and Rs7 million, the rate is proposed to come down from 35% to 32%. The tax would be Rs976,000 plus 32% of the amount over Rs5.6 million.