Sindh Presents Rs. 3.451 Trillion Budget for FY 2025/26, Announces Salary and Pension Increases

Karachi: The Chief Minister of Sindh, Murad Ali Shah, presented the provincial budget for the fiscal year 2025/26 in the Sindh Assembly, totaling Rs. 3.451 trillion. The budget includes several key reforms, including the abolition of five types of taxes.
The session began with the Chief Minister’s budget speech, which was met with protests from MQM members who created disturbances and PTI members who raised pictures of the PTI founder.
Salary and Pension Increases Announced
Chief Minister Murad Ali Shah announced a 12% increase in the salaries of government employees from grade 1 to 16. For employees in grades 17 to 22, salaries would rise by 10%, while pensions would increase by 8%. Additionally, a hike in the conveyance allowance for differently-abled individuals was also announced.
Abolition of Five Taxes
In a major step to simplify the tax system and reduce business costs, the Sindh government proposed the removal of five types of taxes, including Professional Tax, Cotton Fee, Internet Duty, Local Cess, and Drainage Cess.
Tax Cuts on Commercial Vehicles
As part of the Motor Vehicle Ordinance, a Rs. 1,000 reduction in taxes on commercial vehicles was announced. Furthermore, a proposal to cancel third-party insurance on motorcycles was also made, along with a suggestion to reduce stamp duty on third-party motor insurance to Rs. 50. The sales tax on vehicle insurance would also be reduced from 15% to 5%.
Property, Mutation, and Heirship Fee Reductions
The mutation fee for property transactions and sales certificate fees will be reduced from Rs. 1,000 to Rs. 500. Similarly, the fees for certificates and heirship certificates will also be cut to Rs. 500.
Sales Tax Exemptions for Small Businesses
Small businesses in Sindh with a turnover of less than Rs. 4 million will be exempt from sales tax. The proposed changes also include the removal of the negative list of services for sales tax and bringing all services under the sales tax net. However, social and essential services will remain exempt from taxes.
Reduction in Sales Tax Rate for Services
The sales tax rate on services will be reduced from 10% to 8%. Additionally, the threshold for tax exemption on restaurant and catering businesses will be increased from Rs. 2.5 million to Rs. 5 million annually.
CM’s Speech Highlights
Chief Minister Murad Ali Shah expressed his pride in presenting the budget for FY 2025-26, thanking the people of Sindh for their continued trust in the Pakistan Peoples Party (PPP). He highlighted that PPP had received more votes in the recent elections and had won a majority in the general elections.
He also emphasized the government’s successful efforts to improve law and order, noting significant reductions in crime, particularly street crimes in Karachi, and successful operations in the Kacha areas. Efforts to combat drug trafficking and protect youth were also highlighted.
Moreover, the Chief Minister mentioned initiatives such as AI-based surveillance on highways, significant police recruitment, and enhanced health benefits for police personnel. The budget also includes increased allocations for education, including a plan to train 35,000 students in the coming year and further investment in the Sindh Education Foundation with the help of UNICEF for school repairs.