President Asif Ali Zardari on Friday granted his assent to the Finance Bill, 2026, a few days after the National Assembly approved the federal budget for the upcoming fiscal year.
Ahead of the Lower House’s approval, it adopted several amendments moved by Finance Minister Muhammad Aurangzeb in Clauses 5, 6, and 6A, while rejecting the Senate’s recommendations in Clause 6. Amendments proposed by opposition members were all rejected by a majority voice vote.
The budget for FY27 envisions an economic growth rate of 4%, with a projected inflation of 8.2%. It has estimated the fiscal deficit at 3.6% of GDP, and a primary surplus of 2% of GDP.
The government has set Rs. 15.264 trillion as the tax revenue target for the Federal Board of Revenue (FBR), with net federal revenues estimated at Rs. 11.752 trillion against total expenditures of Rs. 18.77 trillion. Of this sum, approximately Rs. 8.05 trillion is earmarked for debt servicing and markup payments.
The federal budget sets aside Rs. 1 trillion for the Federal Public Sector Development Program, with the overall national development program estimated at around Rs. 3.675 trillion.
The House also approved Rs. 3 trillion for defense services and has increased the quantum of the Benazir Income Support Program to Rs. 838 billion. The Finance Bill increases government employees’ salaries and pensions by 7%, and has reduced income tax rates for salaried individuals across four slabs.
The government has also reduced duties on imported vehicles and has decided to impose 10% sales tax on children’s stationery, including pencils, pens, and sharpeners.