PESHAWAR, Jun 19 (APP):Khyber Pakhtunkhwa government here Friday announced a range of tax incentives and financial relief measures in its 2026–27 budget aimed at supporting the business community, industrialists, hotel owners, government employees, and the general public. In his budget speech, Chief Minister Khyber Pakhtunkhwa Sohail Afridi said the government has proposed reducing the Infrastructure Development Cess (IDC) from 2% to 0.75%. This measure will reduce the cess burden by …
KP Govt announces relief package for traders community, Govt employees in budget 2026-27
PESHAWAR, Jun 19 (APP):Khyber Pakhtunkhwa government here Friday announced a range of tax incentives and financial relief measures in its 2026–27 budget aimed at supporting the business community, industrialists, hotel owners, government employees, and the general public.
In his budget speech, Chief Minister Khyber Pakhtunkhwa Sohail Afridi said the government has proposed reducing the Infrastructure Development Cess (IDC) from 2% to 0.75%.
This measure will reduce the cess burden by more than 62% and is being viewed as a significant step toward promoting business activity, investment, and industrial growth.
The government stated that the proposed 0.75% IDC rate would be the lowest in the country, making Khyber Pakhtunkhwa a more attractive destination for investment, trade, and industry.
The move is expected to enhance business confidence, reduce pending disputes, and pave the way for sustainable economic growth in the province.
As part of the public relief package, the government has proposed a property tax exemption for residential and commercial properties up to 5 marlas in size, benefiting approximately 200,000 households.
To support the tourism and hospitality sector, the budget also proposes reducing the hotel bed tax from 7% to 5%.
The government has further announced the abolition of the professional tax on individuals earning the minimum monthly income, providing relief to low-income earners. In addition, government employees in Basic Pay Scales (BPS) 1 to 6 are proposed to receive a complete exemption from professional tax.
To encourage industrial development, the government has decided to offer a 30% discount on outstanding tax arrears for industrial buildings, easing the financial burden on industrialists.
The budget also makes it clear that the existing tax relief policy for the former Federally Administered Tribal Areas (FATA) and Provincially Administered Tribal Areas (PATA) will remain in place. No new taxes will be imposed in these regions during the 2026–27 fiscal year.
According to CM KP these measures are intended to reduce the cost of doing business, attract investment, create new employment opportunities, and provide direct financial relief to citizens
