The federal government has announced a 10% increase in salaries for all government employees, including members of the armed forces and civil departments. This raise will be effective from July 1, 2025, and will also benefit contract-based workers.
Along with the salary hike, a 30% disparity allowance has been introduced for employees who were previously not receiving it. This step aims to reduce pay differences among various government departments and promote equality in compensation.
The government has also revised the income tax structure in the new budget for 2025–26. Under the new system, individuals earning up to Rs600,000 annually will be completely exempt from income tax. For those earning above this amount, tax will be applied on a sliding scale, starting from 1% and going up to 35%, depending on the income level.
These changes are part of the government’s efforts to support public sector employees and provide relief to the salaried class. The salary increase and tax revisions aim to ease the financial pressure on employees, especially in the face of rising inflation and cost of living.
The new measures are expected to improve employee satisfaction, help retain skilled staff in public service, and create a more balanced and fair economic environment. With better pay and a more reasonable tax system, the government hopes to strengthen the overall welfare of its workforce.
