FPCCI Urges Government to Revise Finance Bill

The President of the Federation of Pakistan Chambers of Commerce & Industry (FPCCI), Atif Ikram Sheikh, speaking on behalf of the Pakistani business, industry, and trade sectors, has appealed to the government to remove stringent and detrimental tax measures from the Finance Bill before its parliamentary approval. He emphasized the necessity of a fiscal policy framework that fosters business, encourages investment, and supports growth, particularly as the economy demonstrates stability and potential for expansion.

Sheikh asserted that achieving tax collection targets hinges on incorporating industrialists and exporters into an inclusive consultation process. He expressed disappointment that the budget lacks provisions to empower the business community in realizing the Prime Minister’s vision for export-driven growth.

He cautioned that granting extensive discretionary powers to tax authorities could undermine business and investor confidence, potentially leading to increased harassment, corruption, and administrative inefficiencies.

The FPCCI Chief stated that global best practices indicate that increased interaction between tax collectors and taxpayers often compromises fairness, transparency, and impartiality due to the subjective nature of human judgment. He suggested adhering to established principles rather than seeking novel approaches.

Sheikh acknowledged the reduction in super tax, the rationalization of tax brackets for salaried individuals, the simplification of income tax return forms for salaried individuals and SMEs—a longstanding request of the FPCCI—and the essential increase in defense spending to protect the country’s geo-economics, trade routes, supply chains, and geostrategic interests.

Saquib Fayyaz Magoon, SVP FPCCI, advocated for the reinstatement of the Fixed Tax Regime (FTR) for exporters in its original format for an extended duration to ensure clarity and consistency in tax policies. He noted that maintaining national competitiveness is crucial for attracting both FDI and domestic investment.

Magoon pointed out that instead of expanding the Export Facilitation Scheme (EFS) to include local manufacturers, in accordance with aggregated feedback from various sectors and industries via the FPCCI platform, the government has levied an 18% sales tax on raw materials. This, he warned, would elevate production costs, disrupt supply lines, and diminish the competitiveness of Pakistani products in regional and international markets.

The SVP FPCCI also voiced concern over the omission of special incentive packages for the IT & ITeS, Mines & Minerals, and Fishing industries in the Federal Budget 2025–26, despite the FPCCI’s recommendation. He asserted that these sectors possess significant growth potential.