National ( The cow news digital ) The federal government is considering a 7 to 10 percent increase in salaries and pensions in the upcoming budget, while coalition partners are pushing for a higher adjustment of up to 15 percent, according to official sources. A final decision is expected during the federal cabinet meeting scheduled for June 10.
Prime Minister Shehbaz Sharif is set to chair the National Economic Council (NEC) meeting on June 8, where chief ministers of all four provinces, along with representatives from Gilgit-Baltistan and Azad Jammu and Kashmir, will participate to discuss key budgetary priorities and economic targets.
Sources in the Ministry of Finance indicate that the total size of the federal budget for the next fiscal year is projected at Rs 171 trillion. The government is targeting a GDP growth rate of 4.1 percent, while inflation is estimated at 8.4 percent for the same period.
Revenue projections include a petroleum levy target of Rs 1,727 billion, tax revenue of Rs 15,267 billion, and non-tax revenue of Rs 2,768 billion. The federal Public Sector Development Programme (PSDP) is expected to be around Rs 1,100 billion, while interest payments are estimated at Rs 7,824 billion. Defence spending is proposed at Rs 2,665 billion.
Officials also suggest that around Rs 220 billion in new taxes may be introduced to meet fiscal targets. Proposals include bringing cryptocurrency trading profits into the tax net with a capital gains tax ranging from 10 to 30 percent. Additionally, tax exemptions for former tribal areas may be withdrawn.
Under a proposed fixed tax scheme for traders, shopkeepers with annual sales of up to Rs 200 million would be eligible, paying a 1 percent tax while being exempt from audits, along with a fixed annual return payment of Rs 25,000.
The International Monetary Fund (IMF) has reportedly urged Pakistan to increase the general sales tax from 18 to 19 percent, while also recommending additional measures to achieve revenue targets.
Officials are also considering adjustments to the super tax, with a possible reduction of 1 to 2 percent. Meanwhile, stricter taxation measures are expected on several essential goods, including dairy products, edible oil, tea, sugar, and ghee, with retail price printing becoming mandatory under a revised taxation framework.
Changes in tax policy are also expected for the automobile sector, including the withdrawal of sales tax exemptions on hybrid vehicles and adjustments in tax rates for electric vehicles and CKD kits.
The final budget proposals are expected to be approved after cabinet deliberation, shaping Pakistan’s fiscal direction for the next financial year.
