The federal government has introduced revised income tax slabs for salaried individuals under budget for the fiscal year 2026-27, effective immediately.
Salaried individuals earning below Rs600,000 annually will pay no income tax, keeping the tax-free threshold unchanged from the previous fiscal year’s limit.
Those earning between Rs600,000 and Rs1.2 million will pay one percent on the amount exceeding Rs600,000, representing the lowest applicable tax rate for salaried earners.
Individuals with annual salaries between Rs1.2 million and Rs2.2 million will owe Rs6,000 plus 11 percent on earnings exceeding Rs1.2 million under the revised structure.
The slab covering Rs2.2 million to Rs3.2 million carries a base tax of Rs116,000, with an additional 20% levied on income exceeding Rs2.2 million annually.
Earners in the Rs3.2 million to Rs4.1 million range will pay Rs316,000 plus 25 percent on any income that exceeds the Rs3.2 million lower threshold.
The Rs4.1 million to Rs5.6 million bracket attracts a fixed Rs541,000, plus 29 percent on all income surpassing the Rs4.1 million lower boundary of that slab.
Salaries ranging between Rs5.6 million and Rs7 million will incur Rs976,000 in base tax, plus 32 percent on earnings above the Rs5.6 million threshold.
Individuals earning above Rs7 million annually face the highest rate, paying Rs1.424 million plus 35 percent on all income exceeding the Rs7 million ceiling mark.
| Income Range | Base Tax | Tax Rate on Excess | Threshold for Excess |
| Below Rs. 600,000 | Rs. 0 | 0% | – |
| Rs. 600,000 – 1,200,000 | Rs. 0 | 1% | above Rs. 600,000 |
| Rs. 1,200,000 – 2,200,000 | Rs. 6,000 | 11% | above Rs. 1,200,000 |
| Rs. 2,200,000 – 3,200,000 | Rs. 116,000 | 20% | above Rs. 2,200,000 |
| Rs. 3,200,000 – 4,100,000 | Rs. 316,000 | 25% | above Rs. 3,200,000 |
| Rs. 4,100,000 – 5,600,000 | Rs. 541,000 | 29% | above Rs. 4,100,000 |
| Rs. 5,600,000 – 7,000,000 | Rs. 976,000 | 32% | above Rs. 5,600,000 |
| Above Rs. 7,000,000 | Rs. 1,424,000 | 35% | above Rs. 7,000,000 |
