In this article, you will learn about the Agriculture income tax rates in KPK. It is possible to understand Pakistan’s agricultural taxation system, particularly since agricultural income taxes are provinces’ responsibility. In Khyber Pakhtunkhwa (KPK), the provincial government imposes two principal taxes on agriculture: Agricultural Income Tax and Land Tax. It is significant that while KPK imposes taxation on farming income, the federal government does not.
Agricultural Income Tax Rates in KPK
This is a tax on the income earned from cultivating agricultural land. The Khyber Pakhtunkhwa Land Tax and Agricultural Income Tax Ordinance, 2000, and its amendment, The Khyber Pakhtunkhwa Agricultural Income Tax Act, 2025, describe the mechanism of the tax. The tax is determined on a system where more income results in higher tax.
Agricultural Income Tax Rates for Small Farmers (KPK Agricultural Income Tax Act, 2025):
| Sr. No. | Taxable Income | Rate of Agricultural Income Tax |
| 1 | Up to Rs. 600,000 | 0% |
| 2 | Rs. 600,001 – Rs. 1,200,000 | 15% of the amount exceeding Rs. 600,000 |
| 3 | Rs. 1,200,001 – Rs. 1,600,000 | Rs. 90,000 + 20% of the amount exceeding Rs. 1,200,000 |
| 4 | Rs. 1,600,001 – Rs. 3,200,000 | Rs. 170,000 + 30% of the amount exceeding Rs. 1,600,000 |
| 5 | Rs. 3,200,001 – Rs. 5,600,000 | Rs. 650,000 + 40% of the amount exceeding Rs. 3,200,000 |
| 6 | Rs. 5,600,001 – Rs. 150,000,000 | Rs. 1,610,000 + 45% of the amount exceeding Rs. 5,600,000 |
Agricultural Income Tax Rates for Corporate Farming (KPK Agricultural Income Tax Act, 2025):
Type of Company Rate of Tax
- Small company 20%
- Company 29%
Super Tax on Agricultural Income (KPK Agricultural Income Tax Act, 2025):
In addition to the agriculture income tax, a super tax is also applicable on high agriculture income on individuals and companies.
Super Tax Rates on Agricultural Income
| Sr. No. | Agricultural Income Bracket | Super Tax Rate |
| 1 | Up to Rs. 150 million | 0% |
| 2 | Rs. 150 million – Rs. 200 million | 1% |
| 3 | Rs. 200 million – Rs. 250 million | 2% |
| 4 | Rs. 250 million – Rs. 300 million | 3% |
| 5 | Rs. 300 million – Rs. 350 million | 4% |
| 6 | Rs. 350 million – Rs. 400 million | 6% |
| 7 | Rs. 400 million – Rs. 500 million | 8% |
| 8 | Above Rs. 500 million | 10% |
Key Points about KPK Agricultural Income Tax
- Progressive Tax: The tax rates follow a progressive structure, meaning they increase as income rises. The higher the earnings, the higher the tax rate.
- Filing Responsibility: Landowners who earn above the exempt income threshold are required to file income tax returns with the KPK government.
- Net Income: The tax is applied to net agricultural income, allowing landowners to deduct eligible expenses before calculating the taxable amount.
Land Tax Rates in KPK
Land Tax is a standalone tax, based on the ownership of agricultural land and not on the revenue generated by it. The tax rates are determined by the type of land—Irrigated or un-irrigated, and orchards—and the zone where the land falls. There are four zones of the province of KPK for the purpose of land tax with different rates per acre.
Land Tax Rates by Zone and Land Type (Per Acre)
Zone One
| Slab of Total Cultivated Land (excluding orchards – Irrigated equivalent*) | Rate of Tax per Acre |
| (i) Not exceeding 12½ acres | Nil |
| (ii) Exceeding 12½ acres but not exceeding 25 acres | Rs. 1,200/- |
| (iii) Exceeding 25 acres but not exceeding 50 acres | Rs. 2,500/- |
| (iv) Exceeding 50 acres | Rs. 3,500/- |
| Mature Orchards: | |
| (i) Irrigated | Rs. 3,500/- |
| (ii) Un-irrigated | Rs. 1,750/- |
Zone Two
| Slab of Total Cultivated Land (excluding orchards – Irrigated equivalent*) | Rate of Tax per Acre |
| (i) Not exceeding 12½ acres | Nil |
| (ii) Exceeding 12½ acres but not exceeding 25 acres | Rs. 900/- |
| (iii) Exceeding 25 acres but not exceeding 50 acres | Rs. 1,700/- |
| (iv) Exceeding 50 acres | Rs. 2,500/- |
| Mature Orchards: | |
| (i) Irrigated | Rs. 2,500/- |
| (ii) Un-irrigated | Rs. 1,250/- |
Zone Three
| Slab of Total Cultivated Land (excluding orchards – Irrigated equivalent*) | Rate of Tax per Acre |
| (i) Not exceeding 12½ acres | Nil |
| (ii) Exceeding 12½ acres but not exceeding 25 acres | Rs. 500/- |
| (iii) Exceeding 25 acres but not exceeding 50 acres | Rs. 1,000/- |
| (iv) Exceeding 50 acres | Rs. 1,500/- |
| Mature Orchards: | |
| (i) Irrigated | Rs. 1,500/- |
| (ii) Un-irrigated | Rs. 750/- |
Zone Four
| Slab of Total Cultivated Land (excluding orchards – Irrigated equivalent*) | Rate of Tax per Acre |
| (i) Not exceeding 12½ acres | Nil |
| (ii) Exceeding 12½ acres but not exceeding 25 acres | Rs. 300/- |
| (iii) Exceeding 25 acres but not exceeding 50 acres | Rs. 600/- |
| (iv) Exceeding 50 acres | Rs. 900/- |
| Mature Orchards: | |
| (i) Irrigated | Rs. 900/- |
| (ii) Un-irrigated | Rs. 450/- |
Key Points about KPK Land Tax Rates
- Land Ownership-Based: Land tax is charged based on land ownership rather than income, meaning you pay tax simply for owning agricultural land.
- Zonal Variation: Tax rates can vary significantly depending on the land’s designated zone. For precise details, landowners should check with the KPK Revenue Department.
- Land Type Differentiation: The tax rates differ based on the type of land—cultivated land is taxed based on specific slabs and irrigation status, while orchards have separate rates.
- Irrigated Equivalent: For cultivated land (excluding orchards), the tax calculation follows an “irrigated land equivalent” system—where one acre of irrigated land is considered equal to two acres of un-irrigated land.
Understanding Your Tax Obligations
For landowners in KPK, understanding both Agricultural Income Tax and Land Tax is essential to stay compliant. Here’s how you can determine your tax obligations:
- Identify Your Land Zone: Find out which zone your agricultural land falls under, as Land Tax rates vary by zone. If you’re unsure, check with the KPK Revenue Department for accurate information.
- Calculate Your Land Tax: Use the designated tax rates based on your land type, size, and zone to determine how much Land Tax you owe.
- Assess Your Agricultural Income Tax (if applicable): If your net agricultural income exceeds the exempt threshold, calculate your tax based on the progressive income brackets. Tax rates may also vary depending on whether you fall under the “small farmer” or “corporate farming” category.
- File Your Tax Returns: If your income is taxable, make sure to file your Agricultural Income Tax returns with the KPK government. To avoid any issues, consult the KPK Revenue Department or a tax advisor for guidance on filing procedures and deadlines.
These are the Agricultural income tax rates in KPK. If you have any questions, you can ask them in the comment section below.
If you wish to learn the Income Tax Return filing method, you can enrol in our Tax Return Master Course.
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