The Finance Act 2026 brought major changes to Pakistan tax system. New salaried income tax slabs, the removal of the high-earner surcharge, and updated property transaction rates. Here is everything you need to know.
New Salaried Income Tax Slabs for Tax Year 2027
The government introduced two new salaried brackets. The 35% maximum rate now applies only above PKR 7,000,000 instead of PKR 4,100,000. Here is the full breakdown:
- Up to PKR 600,000: 0% (Nil)
- PKR 600,001 to 1,200,000: 1% of excess over 600,000
- PKR 1,200,001 to 2,200,000: PKR 6,000 + 11% of excess over 1,200,000
- PKR 2,200,001 to 3,200,000: PKR 116,000 + 20% of excess over 2,200,000
- PKR 3,200,001 to 4,100,000: PKR 316,000 + 25% of excess over 3,200,000
- PKR 4,100,001 to 5,600,000: PKR 541,000 + 29% of excess over 4,100,000
- PKR 5,600,001 to 7,000,000: PKR 976,000 + 32% of excess over 5,600,000
- Above PKR 7,000,000: PKR 1,424,000 + 35% of excess over 7,000,000
Surcharge Removed
The 9% surcharge on salaried individuals earning above PKR 10,000,000 has been scrapped. The 10% surcharge for business taxpayers has also been removed. This is a significant relief for high-income earners.
Property Tax Rate Changes
Withholding tax on property transactions has been updated for non-filers. The rate has increased to encourage more people to file returns. Filers continue to enjoy the lower 3% rate.
How These Changes Affect You
If you earn between PKR 3,200,000 and PKR 4,100,000, your tax rate dropped from 30% to 25%. If you earn between PKR 4,100,000 and PKR 5,600,000, your rate dropped from 35% to 29%. High earners above PKR 7,000,000 benefit from the scrapped surcharge. Use our tax calculator to see your exact savings.