Pakistan Tax Rates News – Waystax
Waystax is your go-to source for taxation help and the latest news and updates on tax rates in Pakistan.
As a salaried employee, business owner, or simply interested in knowing the ins and outs of taxes in Pakistan, we will cover everything you need.
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Key Taxation Updates for 2025-26| Tax Rate News
- The government has introduced over Rs623 billion in new taxation and enforcement measures to meet a revenue target of Rs14,131 billion for 2025-26.
- Extraordinary enforcement measures against non-filers have been implemented, including restrictions on their ability to purchase motor vehicles, immovable property, sell securities, and operate bank accounts.
- A new tax of 2% on the gross value of supplies for persons supplying digitally ordered goods through online marketplaces has been introduced.
- Banks and courier services are designated as withholding agents to capture payments in the digital transaction chain.
- Withholding tax rates have been increased in several areas, including a rise from 0.6% to 1% on cash withdrawals by non-filers, and from 4% to 6% on specified services (except IT and IT-enabled services). A flat 15% withholding tax will apply to other non-specified services, and sportspersons will face an increase from 10% to 15%.
- Tax rate on profit on debt has been increased from 15% to 20%, and dividend tax rates have been raised to 25% for general dividends and 15% for dividends from mutual funds.
- Sales tax exemptions for Special Economic Zones (SEZ) and Special Technology Zones (STZ) entities are restricted to a maximum of 10 years or until 2035, whichever is earlier.
- Sales tax exemption on erstwhile tribal areas (FATA/PATA) is extended up to June 30, 2026.
Other Notable Amendments (taxation 2025-2026)
- The appellate process for tax disputes has been reverted to a two-tier appeal forum mechanism.
- 50% of expenditures attributable to cash sales exceeding Rs 200,000 will be disallowed.
- Purchases from non-NTN holders will be disallowed at 10%.
- The useful life of intangibles with an indefinite period has been reduced from 25 to 15 years.
- The minimum tax carry-forward period has been reduced from three years to two years.
- New levies introduced include the Digital Presence Proceeds Tax, Carbon Levy, and New Energy Vehicles Adoption Levy.
What is a Tax Rate? Tax Rate Meaning
A tax rate is just the rate at which a person or company pays tax on their income, sales, or assets. In Pakistan, the state collects taxes from individuals and firms to fund public services like health, education, and infrastructure.
Tax rates are important to know to effectively manage your finances.
Tax Rate Structure in Pakistan
Pakistan has a progressive tax system, i.e., the higher you earn, the higher you pay taxes. This holds for both income tax and company tax.
However, for some taxes, such as sales tax, the rates can be proportional across the board.
Tax Rate Changes in Pakistan
Tax rates can change from year to year, especially during the national budget announcement.
It’s important to stay informed about the tax rate news, as this change can affect your monthly salary, business profits, and investments.
Comparison with Previous Year (FY 2023–24)
| Annual Taxable Income (PKR) | Tax Rate / Formula (2023–24) |
| Up to 600,000 | 0% |
| 600,001 – 1,200,000 | 2.5% of the amount exceeding 600,000 |
| 1,200,001 – 2,400,000 | 15,000 + 12.5% of the amount exceeding 1,200,000 |
| 2,400,001 – 3,600,000 | 165,000 + 22.5% of the amount exceeding 2,400,000 |
| 3,600,001 – 6,000,000 | 435,000 + 27.5% of the amount exceeding 3,600,000 |
| Above 6,000,000 | 1,095,000 + 35% of the amount exceeding 6,000,000 |
Key Changes:
Check Your Tax Bracket
Find out which tax slab you fall under and how it impacts your income.
Tax Rate Example
For example, if you earn PKR 100,000 per month and the income tax rate for your salary range is 10%, your monthly tax would be PKR 10,000.
Similarly, businesses and corporations pay taxes based on their earnings, and the rates vary based on the type of company.
Tax Rate Multiplier
The tax rate multiplier refers to the calculation used to determine your total tax based on your taxable income or the value of your goods.
If your taxable income is PKR 50,000 and the tax rate is 15%, your tax liability will be PKR 7,500.
In economics, the tax rate multiplier shows how changes in tax rates affect a country’s GDP.
When the government raises or lowers taxes, it can have a ripple effect on the economy by influencing how much people spend and businesses invest.
This multiplier helps us understand the bigger impact of tax changes on overall economic activity.
Tax Rate News We Will Cover
Here’s a quick rundown of the key tax rate news in Pakistan we will cover, which affects both individuals and businesses:
| Tax Type | Description |
| Income Tax Rate in Pakistan | Tax on personal income earned by individuals. |
| Sales Tax Rate | Tax on goods and services sold in Pakistan. |
| Corporate Tax Rate | Tax on profits earned by companies and corporations. |
| Withholding Tax Rates | Tax is deducted at source on various income types. |
| Capital Gains Tax Rate | Tax on profits made from selling assets (like property). |
| Property Tax Rate | Tax on owning property or selling property in Pakistan. |
| Vehicle Tax Rates | Tax for vehicle owners, based on the type and value of the vehicle. |
| Rental Income Tax Rates | Tax on income earned from renting properties. |
| Salary Tax Rates | Tax rates are applied to the salaries of employees in Pakistan. |
| Mobile Tax Rate (PTA) | Tax on mobile phone devices for registration with the PTA. |
| Prize Bond Tax Deduction | Tax on winnings from prize bonds for filers. |
| Effective Tax Rate | The overall rate of tax after deductions and exemptions. |
| Agricultural Income Tax | Tax on income earned from agricultural activities. |
| Non Filer Tax Rate | Higher tax rates for non-filers (those not registered with tax authorities). |
Stay Updated With the Latest Tax Rate News in Pakistan
Whether you’re an individual taxpayer, business owner, or a non-filer, understanding the tax rates and how they impact your income and transactions is key to planning your finances.
Keeping an eye on the latest tax rate news makes you compliant and free from unnecessary fines.
If you are not sure of your tax liability or require help with tax calculations, we provide a Tax Rate Calculator to help you in estimating your tax liability using the prevailing rate
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