New Tax Slabs Live, Petrol Below Rs. 300 — Pakistan Economy July 2026
Pakistan enters FY 2026-27 with new income tax slabs in effect from July 1, petrol below Rs. 300/litre, PSX stabilising near 176,000, and forex reserves above $22 billion heading into the new year.
Pakistan Economy — First Week of FY 2026-27
Pakistan has crossed into the new financial year with its macro fundamentals in the strongest shape since before the 2022 crisis. Here is where key indicators stand as of the first week of July 2026.
New Tax Slabs Are Now Live
Effective July 1, 2026, the Finance Act 2026 income tax relief for salaried Pakistanis is in effect. Employers are legally required to apply the revised withholding tax from the July salary onwards.
| Monthly Salary | Old Monthly Tax | New Monthly Tax | Monthly Saving |
|---|---|---|---|
| Rs. 60,000 | Rs. 500 | Rs. 100 | Rs. 400 |
| Rs. 100,000 | Rs. 2,500 | Rs. 500 | Rs. 2,000 |
| Rs. 150,000 | Rs. 10,000 | Rs. 6,000 | Rs. 4,000 |
| Rs. 250,000 | Rs. 31,667 | Rs. 23,000 | Rs. 8,667 |
| Rs. 300,000 | Rs. 29,500+ | Rs. 8,383 | Rs. 21,000+ |
If your July payslip does not reflect lower tax deductions, raise it with your HR department immediately — employers must apply new slabs from July 1.
Use the Tax Calculator to verify your own deduction. Use the Salary Slip Generator to generate an updated payslip under the new slabs.
Petrol Price: Below Rs. 300/Litre for the First Time in Years
Following the historic Rs. 74/litre cut on June 20, 2026, petrol (92 RON) stands at Rs. 299.78/litre — the first time in years the pump price has been below Rs. 300. OGRA’s next scheduled review is due in the first week of July; any further softness in global crude would push prices lower still.
The sustained sub-Rs. 300 petrol price is significant for inflation: the transport CPI component — which was running at 36%+ year-on-year as recently as May 2026 — is expected to show a sharp correction in June/July PBS data.
PSX KSE-100: Consolidating Near 176,000
After touching an all-time high of 180,392 in mid-June 2026, the KSE-100 index has pulled back to the 175,000–177,000 range in the first week of July — a healthy consolidation after the budget-driven surge.
Key dynamics:
- Fiscal year-end portfolio rebalancing by institutional funds drove initial selling
- Year-on-year performance: KSE-100 is still up ~45% from July 2025 levels
- Foreign portfolio investment remains positive — net inflows of $87 million in June 2026
- The new financial year typically brings fresh inflows as mutual funds reset annual targets
The medium-term outlook remains broadly positive given IMF program continuity, falling interest rates, and easing inflation.
Forex Reserves: $22.6 Billion
SBP gross foreign exchange reserves stand at approximately $17.1 billion (total liquid reserves: ~$22.6 billion including commercial banks) — marginally below the June peak but well above the year’s floor.
Key FY2026-27 drivers to watch:
- IMF EFF 5th Review — scheduled for Q1 FY27, will trigger next disbursement (~$1 billion)
- Remittances — July–August historically see elevated inflows as overseas Pakistanis send Eid gifts and school fee support
- Trade deficit — lower oil import costs from falling global crude prices should help contain the deficit
Property Changes: New WHT Rates from July 1
Budget 2026-27 property tax changes are now in effect:
| Tax | Old Rate | New Rate (FY27) |
|---|---|---|
| Section 236K — Buyer WHT | Up to 20% (non-filer tiered) | 1.5% flat |
| Section 236C — Seller WHT | Up to 10% | 2.75% flat |
| Section 7E — Deemed rental income | Applied | Abolished |
These dramatically lower transaction costs for documented buyers and sellers. Use the Property Stamp Duty Calculator to calculate your total transfer cost under the new regime.
Minimum Wage: Rs. 40,700/Month
The federal minimum wage increased from Rs. 37,000 to Rs. 40,700/month on July 1, 2026 — a 10% increase. Provincial governments are expected to follow with matching notifications. Employers must ensure all workers earning at or below the previous minimum receive the adjustment from the July salary.
What to Watch in July 2026
- SBP Monetary Policy Decision — next meeting expected late July; markets are watching for a potential further 100–150 bps cut given falling inflation
- PBS Inflation Data (June 2026) — expected July 15; the petrol price cut should push headline CPI below 10% year-on-year for the first time since 2021
- IMF Article IV consultation — scheduled for Q1 FY27
- Remittance data (June 2026) — SBP releases around July 14; consensus expects another $3B+ month
Data sourced from OGRA, SBP, PBS, PSX, and IMF releases. For educational purposes only, not financial advice.
HisaabKar Editorial
M.Phil Economics, B.Com · Pakistan Finance Specialist
Covering Pakistani economy, monetary policy, and financial markets for everyday readers.