The federal budget for the upcoming fiscal year (FY26-27) is set to be presented in the upper and lower houses of the Parliament today.
Finance Minister Muhammad Aurangzeb is expected to present the financial plan in the National Assembly at 3pm, and later in the Senate, according to Parliamentary Affairs Minister Tariq Fazal Chaudhry.
The coalition government is set to unveil fresh tax measures worth Rs660 billion to Rs700bn in the budget, according to a Dawn report.
In contrast to the broader revenue measures, the budget carries highly targeted good news for mid- and upper-level income earners.
Significant relief is planned for salaried individuals earning between Rs230,000 and Rs341,000 a month in the upcoming budget, but a large segment of those making between Rs100,000 and Rs183,000 per month may not see any change, official sources said.*
Individuals earning between Rs230,000 and Rs300,000 a month are expected to see a steep reduction in their tax burden, official sources involved in budget preparations told Dawn.
PM Shehbaz has said that the government was taking measures to bring the informal economy into the tax net.
The government last week unveiled the ‘Fixed Tax Asaan Scheme’ to bring small traders and shopkeepers into the tax net, with an annual turnover of up to Rs200 million.
It was reportedly also considering relaxing the remittance cap in the upcoming budget as overseas Pakistanis in several countries face difficulties in protecting their investments and liquid assets abroad.
Until last week, the federal government, its coalition partners and provincial governments had been struggling to reach a consensus over the Centre’s demand for more than Rs1 trillion for strategic needs.
However, the ruling PML-N and its major ally, the PPP, on Monday reached a broad agreement on cutting development and other expenditures at all tiers of the federation to cover around Rs800bn revenue shortfall this year and jointly create similar, but higher, fiscal space next year for additional “strategic needs”.
Under the agreement, provincial shares from the federal divisible pool would stay frozen at the current fiscal year’s position.
The National Economic Council (NEC), the highest economic decision-making forum of the federation, has set the federal and provincial development budget at Rs3.218 trillion for FY26-27.
It trimmed the federal and provincial uplift plans cleared by the Annual Plan Coordination Committee (APCC) by Rs1.046tr.
Punjab’s development plan was chopped by almost half, or 49pc, the biggest cut among all stakeholders, while Balochistan’s Rs308bn plan remained unaffected.
