Islamabad: Finance Minister Muhammad Aurangzeb has reiterated the government’s unwavering commitment to steer the nation towards inclusive and sustainable economic growth. During the closure of discussions on the finance bill 2025-26 in the Senate on Saturday, he highlighted the government’s focus on fiscal discipline, inflation control, foreign exchange reserve enhancement, and current account improvement in the previous fiscal year.
According to Radio Pakistan, the Finance Minister outlined that the budget for 2025-26 is designed to promote public welfare while maintaining fiscal discipline. He noted that federal expenditures are projected to rise by only 1.9 percent in the upcoming fiscal year, a significant decrease compared to the ten or twelve percent increases observed in previous years.
On Prime Minister Shehbaz Sharif’s directives, the Finance Minister announced a reduction in the income tax rate for individuals earning between 600,000 and 1.2 million rupees from 2.5 percent to one percent. Additionally, salaries have been increased by ten percent, and pensions for retired employees have been raised by seven percent.
Moreover, Muhammad Aurangzeb revealed a decision to cut the sales tax on solar panels from eighteen percent to ten percent after thorough consultations. The budget for the Benazir Income Support Program has also been increased from 592 billion rupees to 716 billion rupees.
The Finance Minister expressed gratitude towards the Senate Standing Committee on Finance and Revenue for their recommendations on the Finance bill 2025-26, confirming that about fifty percent of these suggestions will be incorporated into the budget. Earlier, the Senate adopted the committee’s recommendations regarding the bill.
Standing Committee Chairman Saleem Mandviwalla presented key recommendations, including a proposal to raise the minimum wage and consider further salary increments for employees. Mandviwalla emphasized the need to strengthen the Public Finance Act to reduce government borrowings and suggested eliminating taxes on educational stationery items.
Furthermore, it was recommended that taxes on vehicles of 800 cc remain at the current 12.5 percent, and that taxes on print, media, and IT services should not be increased. These recommendations will be forwarded to the National Assembly for consideration.
The chair noted that the standing committee on finance and revenue compiled 204 recommendations concerning the finance bill 2025-26, all of which will be reviewed by the National Assembly. He also mentioned that the Senate engaged in comprehensive discussions on the budget before the house was prorogued.