Initially, the budget proposed a 2.5 percent tax on incomes of more than Rs600,000 for people with an annual income of Rs600,000 to Rs1.2 million, which has now been further reduced to one percent by the Standing Committee on Finance.

The income tax rate on annual salary in upper slabs is as follows:

For people with an annual income of more than Rs1.2 million and less than Rs2.2 million, a fixed tax of Rs6,000 and 11 percent will be imposed on income above Rs1.2 million.

For annual income of more than Rs2.2 million and less than Rs3.2 million, there will be a fixed tax of Rs116,000 and 23% tax on the amount above Rs2.2 million rupees.

For people having income above Rs3.2 million, It has been proposed to impose a tax of 30 percent on incomes between Rs3.2 million and Rs4.1 million and a fixed tax of Rs346,000

For people with salaries exceeding Rs4.1 million, Rs.616,000 is proposed as fixed tax along with 35% on income exceeding Rs4.1 million.

It should be noted that the people with annual salary of Rs600,000 or less are tax free. Another important thing to notice is that these reduced tax slabs have resulted in significant reduction of tax amounts particularly for the lower class of the country.