As of January 2026, the “basic salary” in Pakistan—legally referred to as the Minimum Wage—has seen significant updates across different provinces. While the Federal Government set a baseline in the previous budget, provincial governments have adjusted these rates to cope with inflation.

As of January 2026, the “basic salary” in Pakistan—legally referred to as the Minimum Wage—has seen significant updates across different provinces. While the Federal Government set a baseline in the previous budget, provincial governments have adjusted these rates to cope with inflation.

Here is a comprehensive breakdown of the current salary structure in Pakistan.

1. Current Minimum Wage in Pakistan (2026)

The minimum wage is the lowest legal amount an employer can pay an unskilled worker for 26 working days (8 hours/day). For the fiscal year 2025–26, the rates are as follows:

Note: Sindh was the first to implement the Rs. 40,000 threshold (effective July 2025), with Punjab and KPK following suit to align with the rising cost of living.

2. Skilled & Semi-Skilled Salary Scales

Basic salary isn’t a “one size fits all.” In industrialized regions like Sindh, the Minimum Wages Board has categorized pay based on skill levels for 60 different industries (including Textiles, Chemicals, and Media).

• Semi-Skilled Workers: Roughly Rs. 42,000 – Rs. 45,000.
• Skilled Workers: Ranges from Rs. 48,000 – Rs. 52,000.
• Highly Skilled Workers: Can exceed Rs. 55,000 as a starting basic.

3. Public Sector: The Basic Pay Scale (BPS)

For government employees, “Basic Salary” is part of a structured BPS (Basic Pay Scale) system.

• BPS-1 to BPS-5: These entry-level positions generally align with the national minimum wage but include additional “Ad-hoc Relief Allowances” (often 20–25%) granted in the latest budget.
• Allowances: The “Take-home” pay is usually much higher than the “Basic” because it includes House Rent Allowance (HRA), Medical Allowance, and Conveyance Allowance.

4. Key Labor Laws & Protections

If you are an employee or an employer in Pakistan, you must be aware of these legal requirements under the Minimum Wages Ordinance, 1961:

• Gender Equality: Male and female workers must receive equal pay for work of equal value.
• Payment Method: All registered industrial and commercial establishments are legally required to pay wages via Bank Transfer or Cross Cheque.
• Deductions: Employers cannot make unauthorized deductions. Deductions for EOBI (5% Employer, 1% Employee) are standard.
• Overtime: Any work beyond 8 hours a day or 48 hours a week must be paid at double the ordinary rate of wages.

5. Tax Brackets for 2026

For salaried individuals, your “Basic Salary” determines your tax liability. As per the current Finance Act:

• Up to Rs. 600,000/year (Rs. 50,000/month): 0% Tax.
• Rs. 600,001 to Rs. 1,200,000/year: 1% tax on the amount exceeding 6 Lakh.

Pakistan Salary & Tax Structure (2025–2026)

In the current fiscal year, the government has introduced significant tax relief for low and middle-income earners while increasing the burden on high-income individuals.

1. The Income Tax Slabs (Salaried Individuals)

If your annual salary exceeds Rs. 600,000, you are liable for income tax. The following table shows the current FBR tax rates:

2. Mandatory EOBI Deductions

EOBI (Employees’ Old-Age Benefits Institution) is a mandatory social security contribution.

• Employee Share: 1% of the minimum wage.
• Employer Share: 5% of the minimum wage.
• Current Rate: With the minimum wage now at Rs. 40,000 in most provinces, the fixed monthly deduction for an employee is Rs. 400.

How to Calculate Your Net Salary

Use the following logic to find your actual take-home pay:

Example: Monthly Salary of Rs. 100,000

1. Annual Gross:
2. Annual Tax:
3. Monthly Tax:
4. EOBI Deduction: Rs. 400
5. Net Take-Home: Rs. 99,100

Important Notes for 2026

• Surcharge: If your annual income exceeds Rs. 10 Million, you must pay an additional surcharge of 9% on your total income tax.
• Allowances: Most allowances (House Rent, Utilities) are taxable, but Medical Allowance is tax-exempt up to 10% of your Basic Salary if you are not provided with a specific medical facility by your employer.

Would you like me to generate a customized monthly payslip for a specific salary amount, or perhaps show you how these taxes change if you are a non-filer?

How to check your EOBI status online
This video is relevant as it provides a practical guide for employees to verify their EOBI registration and contributions, which is a key deduction from the basic salary in Pakistan.

As of January 2026, the “basic salary” in Pakistan—legally referred to as the Minimum Wage—has seen significant updates across different provinces. While the Federal Government set a baseline in the previous budget, provincial governments have adjusted these rates to cope with inflation.

As of January 2026, the “basic salary” in Pakistan—legally referred to as the Minimum Wage—has seen significant updates across different provinces. While the Federal Government set a baseline in the previous budget, provincial governments have adjusted these rates to cope with inflation.

Here is a comprehensive breakdown of the current salary structure in Pakistan.

1. Current Minimum Wage in Pakistan (2026)

The minimum wage is the lowest legal amount an employer can pay an unskilled worker for 26 working days (8 hours/day). For the fiscal year 2025–26, the rates are as follows:

Note: Sindh was the first to implement the Rs. 40,000 threshold (effective July 2025), with Punjab and KPK following suit to align with the rising cost of living.

2. Skilled & Semi-Skilled Salary Scales

Basic salary isn’t a “one size fits all.” In industrialized regions like Sindh, the Minimum Wages Board has categorized pay based on skill levels for 60 different industries (including Textiles, Chemicals, and Media).

• Semi-Skilled Workers: Roughly Rs. 42,000 – Rs. 45,000.
• Skilled Workers: Ranges from Rs. 48,000 – Rs. 52,000.
• Highly Skilled Workers: Can exceed Rs. 55,000 as a starting basic.

3. Public Sector: The Basic Pay Scale (BPS)

For government employees, “Basic Salary” is part of a structured BPS (Basic Pay Scale) system.

• BPS-1 to BPS-5: These entry-level positions generally align with the national minimum wage but include additional “Ad-hoc Relief Allowances” (often 20–25%) granted in the latest budget.
• Allowances: The “Take-home” pay is usually much higher than the “Basic” because it includes House Rent Allowance (HRA), Medical Allowance, and Conveyance Allowance.

4. Key Labor Laws & Protections

If you are an employee or an employer in Pakistan, you must be aware of these legal requirements under the Minimum Wages Ordinance, 1961:

• Gender Equality: Male and female workers must receive equal pay for work of equal value.
• Payment Method: All registered industrial and commercial establishments are legally required to pay wages via Bank Transfer or Cross Cheque.
• Deductions: Employers cannot make unauthorized deductions. Deductions for EOBI (5% Employer, 1% Employee) are standard.
• Overtime: Any work beyond 8 hours a day or 48 hours a week must be paid at double the ordinary rate of wages.

5. Tax Brackets for 2026

For salaried individuals, your “Basic Salary” determines your tax liability. As per the current Finance Act:

• Up to Rs. 600,000/year (Rs. 50,000/month): 0% Tax.
• Rs. 600,001 to Rs. 1,200,000/year: 1% tax on the amount exceeding 6 Lakh.