The federal budget for 2026–27 has brought the salaried class something it has rarely seen in recent years: a tax cut.

In his budget speech, the finance minister has announced reduced income tax rates for salaried individuals earning between Rs2.2 million and Rs7 million a year, restructured the slabs from six to eight, and abolished the surcharge that currently applies to annual incomes above Rs10m.

But what those changes mean for you depends entirely on where your salary falls.

Most relief has been given to the middle and upper slabs. The rate on income between Rs2.2m and Rs3.2m a year has dropped from 23 per cent to 20pc (3pc), while the old top rate of 35pc, which previously applied to annual income above Rs4.1m, now applies only to income above Rs7m. There are new 25pc, 29pc and 32pc bands in between.

Those earning up to roughly Rs183,000 a month, however, will see no change at all: the bottom three slabs, including the Rs600,000 tax-free threshold, have been kept unchanged.

You can use Dawn’s income tax calculator below to see how the proposed income tax measures will change your take-home salary.

Budget 2026–27 · Interactive

What the budget means for your salary

Enter your monthly gross salary to see your income tax and take-home pay under the new slabs — and how it compares with the outgoing year.

Your monthly gross salary

Rs

Before any deductions. Figures assume your full salary is taxable income.

Rs 100,000 Rs 200,000 Rs 350,000 Rs 500,000 Rs 10 lakh

Your monthly saving under the new budget

Rs 0

Swipe sideways to see all columns →

	FY 2025–26 outgoing	FY 2026–27 new	Difference
Per month
Income tax	—	—	—
Take-home salary	—	—	—
Per year
Income tax	—	—	—
Take-home salary	—	—	—

Note: FY 2026–27 figures are based on the rates announced in the federal budget speech and remain proposals under the Finance Bill 2026 until passed by the National Assembly; final rates may change. FY 2025–26 figures follow the Finance Act 2025. Calculations apply salaried-individual slabs to gross salary as fully taxable income and exclude allowances, deductions, tax credits and other adjustments. The 9% surcharge on annual taxable income above Rs 10 million applies to FY 2025–26 and is proposed to be abolished for FY 2026–27. This tool is for general information only and is not tax advice.

Dawn.com