The federal government has decided to provide inflation-adjusted salary relief to public sector employees in the upcoming budget 2025–26, while also considering major steps to discourage cash transactions, official sources confirmed.
Finance Bill 2025 is expected to include proposals targeting cash-based purchases.
One key suggestion under consideration is the imposition of an additional charge of up to Rs3 per litre on fuel purchased with cash at petrol stations. The move aims to combat tax evasion and fuel adulteration.
In parallel, public employees have demanded substantial increases in salaries and allowances, calling for the minimum monthly wage to be set at Rs50,000. The government workers have warned of a sit-in in front of Parliament on June 10 if their demands are not met.
Other proposed measures include an additional 2% tax on cash sales by manufacturers and importer and an extra tax on cash purchases from Tier-1 retailers.
Continued tax exemptions on debit and credit card payments at restaurants. Promotion of digital payment options at petrol pumps, including QR codes, debit/credit cards, and mobile payment services.
Despite the crackdown on cash transactions, sources say there are currently no proposals to bring event managers, jewellers, wedding halls, doctors, or lawyers into the tax net in the upcoming budget.
The proposed reforms reflect the government's effort to increase transparency in the economy, encourage digital payments, and broaden the tax base without burdening key service sectors.
