Pakistan to review ‘disproportionate’ tax burden on salaried class in upcoming budget— finance minister

A man sits outside a bank along a street in Rawalpindi, Pakistan on July 15, 2023. (AFP/File)
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Updated 23 February 2025
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Pakistan to review ‘disproportionate’ tax burden on salaried class in upcoming budget— finance minister

  • Pakistan last year increased tax revenue by $80.50 for all persons earning over Rs50,000 per month
  • Muhammad Aurangzeb urges real estate, wholesale and retail sectors to “step up” with more taxes

ISLAMABAD: Pakistan’s Finance Minister Muhammad Aurangzeb said on Sunday that the government would review the “disproportionate burden” suffered by the country’s salaried class due to high taxes, calling on other sectors to “step up” to remedy the situation. 

Pakistan last year passed its Rs13 trillion ($46.66 billion) national budget to strengthen the case for an International Monetary Fund (IMF) bailout deal. The budget increased the tax liability by Rs22,500 [$80.50] for all persons earning more than Rs50,000 [$178.89] a month. In 2023 also the government imposed a higher income tax on salaried persons it deemed “high earners.”

The move invited anger from Pakistan’s salaried class, including the Salaried Class Alliance of Pakistan, who warned of a brain drain and said they were already burdened by high taxes, surging inflation and strained incomes. 

“The manufacturing industry and the salaried class has suffered a disproportionate burden,” Aurangzeb told reporters “We will undertake all efforts to try to review this in the next budget and take this toward rationalization.”

The finance minister said that other income segments and sectors will have to contribute by paying more taxes. He pointed out that for the first time, Pakistan’s provincial assemblies had passed the agriculture income tax bill. 

“In the same way, our brothers and sisters in the real estate and wholesale and retailers sector will all have to step up, so that the burden on other categories can be adjusted in a proportionate manner,” Aurangzeb said.

In response to a question, Aurangzeb said Pakistan’s diaspora abroad was happy with the government’s policies. He thanked overseas Pakistanis for contributing with increased remittances every month.

“The way remittances are increasing, this year we expect them to reach around $35 billion as compared to $30.2 billion last year,” Aurangzeb said. 


Pakistan says ‘national security is non-negotiable’ after Afghanistan strikes

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Pakistan says ‘national security is non-negotiable’ after Afghanistan strikes

  • Islamabad says recent cross-border strikes targeted Afghanistan-based militants behind recent attacks
  • Kabul has condemned strikes, accused Pakistan of violating territorial sovereignty and killing civilians

ISLAMABAD: Pakistan’s Parliamentary Secretary for Information and Broadcasting Danyal Chaudhry said on Monday “national security is non-negotiable,” defending Islamabad’s recent cross-border strikes inside Afghanistan following a number of recent militant attacks.

The remarks come after Pakistan said it launched “intelligence-based selective targeting” of seven militant camps along the Afghan border in response to a mosque bombing in Islamabad and violence in the northwestern border districts of Bajaur and Bannu, among other attacks. Authorities say many of the assaults have been carried out by the Tehreek-e-Taliban Pakistan (TTP) and allied groups that Islamabad alleges are operating from sanctuaries in Afghanistan, whose government denies this.

Kabul has condemned Sunday’s strikes as a violation of its sovereignty and claimed civilians were killed. Pakistan has not responded to that allegation.

Tensions between the two neighbors have escalated sharply despite a fragile ceasefire agreed after deadly clashes in October. 

“Pakistan has always chosen the path of dialogue and peaceful coexistence. But when Afghan soil continues to be used for proxy attacks, we have no choice but to defend our homeland. National security is non-negotiable,” Chaudhry said in a statement.

He said the recent operation had “successfully neutralized militants involved in attacks on Pakistani soil,” adding that “every precaution was taken to protect innocent lives.”

Pakistan has repeatedly accused Afghanistan’s Taliban rulers of allowing TTP militants and fighters linked to the Islamic State Khorasan Province (ISKP), the regional affiliate of the Daesh group, to operate from Afghan territory, claims Kabul denies.

Chaudhry referred to a recent United Nations report, saying militants from 21 countries were now operating from Afghan territory and posed a threat to regional stability.

Afghanistan’s defense ministry earlier condemned what it called a breach of international law and vowed a “measured response at a suitable time.” Its foreign ministry summoned Pakistan’s ambassador over what it described as violations of Afghan airspace.

Islamabad has also accused neighboring India of backing anti-Pakistan militant groups, a charge New Delhi has consistently denied.

The latest exchange has raised concerns of renewed instability along the 2,600-kilometer frontier, where repeated border closures have disrupted trade and strained diplomatic ties. Analysts say the escalation risks undoing recent efforts at de-escalation, including the Saudi-mediated release of three Pakistani soldiers earlier this month.