Islamabad: The federal government has introduced new income tax slabs for government employees and salaried class from July 1, 2026.

The National Assembly has approved the Finance Bill 2026, under which new tax rates have been fixed for people with different incomes.

According to the Finance Bill, people with an annual income of up to Rs 600,000 will be completely exempted from income tax. While people with an annual income of between Rs 600,000 and Rs 120,000 will be charged one percent income tax.Under

the new tax system, people with an annual income of Rs 120,000 to 220,000 will have to pay a fixed tax of Rs 6,000 plus 11 percent tax on the additional amount. Similarly, people with an annual income of Rs 220,000 to Rs 320,000 will be charged a fixed tax of Rs 116,000 and a tax of 20 percent on the additional amount, while earlier this rate was 23 percent.