Punjab Chief Minister Maryam Nawaz Sharif has approved a 10% salary increase for government employees in the upcoming budget for fiscal year 2025-26.
The approval came just days before the provincial government is set to present its budget this week.
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Punjab’s decision aligns with the federal government’s proposals announced in the national budget.
A day earlier, Finance Minister Muhammad Aurangzeb presented the federal budget with a total outlay of Rs17,573 billion, focusing on economic growth.
At the federal level, a 10% adhoc relief allowance on salaries, a 7.5% increase in pensions, and revised income tax rates were introduced for the next fiscal year.
According to the new tax structure, individuals earning up to Rs600,000 annually will remain exempt from income tax.
For those earning between Rs600,000 and Rs1.2 million, a 1% tax applies to the amount exceeding Rs600,000.
Salaries ranging from Rs1.2 million to Rs2.2 million will face a fixed tax of Rs6,000 plus 11% on the amount exceeding Rs1.2 million.
Individuals with annual incomes between Rs2.2 million and Rs3.2 million will pay Rs116,000 in fixed tax and 23% on the amount above Rs2.2 million.
