Salaried Class to Receive Tax Relief in Upcoming Federal Budget: Finance Minister Aurangzeb

Federal Finance Minister Muhammad Aurangzeb has announced that the government will introduce relief measures for the salaried class in the upcoming federal budget, as part of broader economic reforms and commitments under the International Monetary Fund (IMF) program.

Relief Measures and Budget Implementation

Addressing the media, Aurangzeb revealed that a dedicated relief package for salaried individuals has already been drafted and will soon be submitted to the IMF. The federal budget, which will take effect from July 1, 2025, aims to address inflationary pressures on middle-income earners through tax relief and energy cost reductions.

He confirmed that no amendments will be made to the budget after its presentation, ensuring its immediate enforcement from the start of the fiscal year.

Electricity Cost Reduction and IMF Coordination

The minister also stated that the government is working to lower electricity bills before or by July, in collaboration with the IMF. This is part of ongoing negotiations under the current Extended Fund Facility (EFF). Aurangzeb confirmed that Pakistan has met all IMF performance criteria, with only minor delays in execution.

The IMF Executive Board is expected to approve the recently agreed Staff-Level Agreement in May, which would unlock the next $1 billion tranche of funding and additional support for climate resilience projects.

Stakeholder Engagement and Tax Reforms

Aurangzeb shared that the government has received 98% of budget proposals from public and private sector stakeholders. These proposals are being reviewed for inclusion in the budget. Relevant sectors will be notified in advance about which suggestions have been accepted and which were excluded, along with explanations.

In terms of tax reform, the minister highlighted improved compliance from the business community. He noted that a simplified tax return form is in development to enable individuals—particularly salaried workers—to file their taxes independently.

Additionally, Aurangzeb announced a structural change, confirming that tax policy will now be overseen directly by the Ministry of Finance, streamlining administrative responsibilities and strengthening oversight.