Pakistan notifies Finance Act 2026-27 ahead of budget announcement on July 1

The federal government has released the gazette notification for the Finance Act 2026-27 to pave the way for enforcement of the federal budget from July 1, the commencement of the next fiscal year.

All tax adjustments, customs taxes and fiscal decisions outlined in the 2026-27 budget will come into action from Tuesday, the Finance Act said.

The government has decreased the advance tax on property deals. From July 1, sellers will have to pay an advance tax of 2.75% on the transaction value and buyers will have to pay an advance tax of 1.25% on the fair market value of the property.

Banking firms and the fertiliser sector will also be taxed at 10% on earnings above Rs150 million and corporate organizations with earnings of more than Rs500 million will be taxed at 8%.

Also, international payments made using credit and debit cards will be subject to a 0.5% withholding tax.

The Finance Act also brings down customs taxes in a number of areas. The import tariff on automobiles with engine capacity between 850cc and 1800cc has been slashed by 35-50%, while duties on auto parts and motorbikes have been decreased by 10% and 20% respectively.

Also, additional customs charge has been decreased by 2% on auto sector, vegetable oil, gold, silver and mobile phones. The government predicts that revenue will decline by Rs47.06 billion as a result of reduction and abolition of further customs taxes, while revenue will be lowered by another Rs65.57 billion by slashing regulatory duties.

The National Assembly has passed the Finance Act, which has become law after being signed by the president and notified through an official gazette. The new budget changes will officially take effect from July 1 2026.