ISLAMABAD: The federal government has officially enforced the Budget 2026-27 after issuing the gazette notification for the Finance Act 2026. The new budget measures will take effect from July 1, bringing major changes in taxes, customs duties, and fiscal policies.
The Budget 2026-27 introduces revised advance tax rates on property transactions. Under the new law, property sellers will pay an advance tax of 2.75 percent on the gross sale amount. Buyers will now pay 1.25 percent of the property’s fair market value.
The government has also imposed new taxes on selected sectors under Budget 2026-27. Banking companies and fertilizer manufacturers earning more than Rs150 million will now face a 10 percent tax on their income.
Corporate businesses with annual income above Rs500 million will be charged an 8 percent tax. Officials say these steps are aimed at increasing revenue collection in the new fiscal year.
Starting July 1, international transactions made through credit and debit cards will also be taxed. A 0.5 percent withholding tax will apply to such payments.
The Budget 2026-27 also includes major relief in customs duties. The government has reduced customs duties on imported vehicles with engine capacities between 850cc and 1,800cc by 35 to 50 percent.
Customs duties on auto parts have been reduced by 10 percent. Motorcycle duties have also been cut by 20 percent under the updated auto policy.
In addition, extra customs duties on the auto sector, vegetable oil, gold, silver, and mobile phones have been reduced by 2 percent.
Government officials said these reductions will lower revenue by Rs47.06 billion. Cuts in regulatory duties are expected to reduce revenue by another Rs65.57 billion.
The Finance Act 2026 was earlier approved by the National Assembly and later signed by the president. With the gazette notification now issued, the Budget 2026-27 has formally become law.
In other news read more about KP Budget 2026-27: Salaries Set to Rise as Govt Plans 13% Increase
All new tax and customs measures will now be implemented from July 1 as Pakistan enters the new fiscal year.
