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Govt revises income tax slabs, learn how much tax is on your salary

Revised tax slabs show enhanced taxation across income categories

Shakeel Ahmed Jun 25, 2022

Govt enhances income tax on people earning more than Rs50,000 Revised tax slabs show enhanced taxation across income categories

With pressure to enhance tax collection, the government has caved in to demands from the global lending body and revised its income tax slabs for the upcoming fiscal year, enhancing collection from all but the lowest of slabs.

In a set of revised income tax slabs submitted by the government in the National Assembly for inclusion in the budgetary proposals, the government has all but revamped the tax slabs.

Previously, the government had decided to consolidate nine tax slabs into seven slabs. It had also lowered the overall tax burden on the salaried classes by imposing only a token tax on people earning up to Rs100,000 per month while those earning Rs50,000 or less were completely exempted.

However, the new proposed tax slabs show that the government has walked back on a lot of those tax measures.

According to the new tax slabs, only those at the bottom of the pay scale, earning less than Rs50,000 per month (or Rs600,000 per year) will be exempt from income tax.

Those earning Rs100,000 or less per month will have to pay 2.5% tax on income exceeding Rs600,000 annually. This is far more than the flat Rs100 proposed in the budget on June 10 but far less than what is being charged currently.

Those earning more than Rs100,000 per month but less than Rs200,000 per month will have to pay a fixed charge of Rs15,000 and 12.5% on the amount exceeding Rs1.2 million annually. This is nearly twice what was proposed in the budget on June 10 but less than what is being charged currently.

Similarly, those earning more than Rs200,000 per month but less than Rs300,000 per month will have to pay a fixed sum of Rs165,000 plus 20% on the amount exceeding Rs2.4 million annually. This is nearly twice what was proposed in the budget on June 10 but far less than what is being charged currently.

Those earning more than Rs300,000 per month but less than Rs500,000 per month will have to pay Rs405,000 as a fixed sum in addition to 25% of the amount exceeding Rs3.6 million annually. This is nearly twice what was proposed in the budget on June 10 but far less than what is being charged currently.

For those earning Rs500,000 and up to Rs1 million per month, they will have to pay Rs1.005 million in a fixed sum and 32.5% of the amount exceeding Rs6 million annually. This is more than what was proposed in the budget on June 10 but far less than what is being charged currently.

Those earning more than Rs1 million per month will have to pay a fixed sum of Rs2.95 million and 35% on the amount exceeding Rs12 million annually. This is far more than what was proposed in the budget on June 10 but far more than what is being charged currently.

Taxable income slabs	Rate of tax 2022 (REVISED)	Rate of tax 2022 (As in budget documents)
Income doesnot exceed Rs600,000	Rs0	Rs0
Income b/w Rs600,000 and Rs1,200,000	2.5% on amount exceeding Rs600,000	Rs100
Income b/w Rs1,200,001 and Rs2,400,000	Rs15,000 + 12.5% on amount exceeding Rs1,200,000	7% of amount exceeding Rs1,200,000
Income b/w Rs2,400,001 and Rs3,600,000	Rs165,000 + 20% of amount exceeding Rs2,400,000	Rs84,000 + 12.5% of amount exceeding Rs2,400,000
Income b/w Rs3,600,001 and Rs6,000,000	Rs405,000 + 25% of amount exceeding Rs3,600,000	Rs234,000 + 17.5% of amount exceeding Rs3,600,000
Income b/w Rs6,000,001 and Rs12,000,000	Rs1,005,000 + 32.5% of amount exceeding Rs6,000,000	Rs654,000 + 22.5% of amount exceeding Rs6,000,000
Income above Rs12,000,000	Rs2,955,000 + 35% of amount exceeding Rs12,000,000	Rs2,004,000 + 32.5% of amount exceeding Rs12,000,000

Earlier, Prime Minister Shehbaz Sharif also announced a tax on the super-rich including a 1% tax on those earning more than Rs150 million per year (Rs12.5 million per month), 2% more tax on those with an income of above Rs200 million (Rs16.67 million per month) or more, 3% tax on those earning over Rs250 million (Rs20.83 million per month) and 4% tax on above Rs300 million (Rs25 million per month).