Budget 2025-26: 18% tax imposed on vehicles and solar panels
The federal budget for 2025-26 has been presented in the National Assembly under the leadership of Speaker Ayaz Sadiq by Federal Finance Minister Muhammad Aurangzeb. Here are the significant decisions announced:
Increased Taxes on Small Cars and Solar Panels
Small Cars: The sales tax rate on small cars is being increased from 12.5% to 18%. This will likely make these vehicles more expensive.
Solar Panels: An 18% sales tax is being imposed on the import of solar panels. According to Finance Minister Muhammad Aurangzeb, this decision aims to promote the local solar panel industry within the country.
Federal Cabinet Approves Budget 2025–26
The federal cabinet has approved the budget proposals, including a 6% increase…
Tax Relief for Salaried Class
In a move to provide relief, the budget includes decisions to reduce tax rates for the salaried class:
Annual Income of PKR 6 lakh to 12 lakh: The tax rate will be reduced from 5% to 1%. For an income of PKR 12 lakh, the tax amount is proposed to be reduced from PKR 30,000 to PKR 6,000.
Annual Income up to PKR 22 lakh: The tax rate has been reduced from 15% to 11%.
Annual Income from PKR 22 lakh to 32 lakh: The tax rate has been reduced from 25% to 23%.
