Businessmen air concern over budget measures
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Reacting to the federal budget for fiscal year 2025-26, business leaders and industrialists raised concerns, citing increased burden on taxpayers and the lack of incentives for economic growth.
Businessmen Group (BMG) Chairman Zubair Motiwala, while calling it a "camouflage budget," expressed serious reservations about its unrealistic targets and the absence of any meaningful relief for the business community or the common man.
The budget includes various announcements related to digitalisation and promoting the cashless economy. These measures alone are insufficient for stimulating exports or driving industrialisation, which are critical for sustainable economic growth, he stated.
Addressing a press conference at the Karachi Chamber of Commerce and Industry (KCCI) after the finance minister's budget speech on Tuesday, he criticised the government for setting overly ambitious goals despite the country's poor economic performance in the previous fiscal year, during which all major targets, including GDP growth and fiscal consolidation, were missed.
Motiwala questioned the rationale behind increasing targets without providing any practical explanation regarding how these would be achieved, especially in a fragile economic environment dominated by uncertainty, high inflation and the IMF-imposed constraints.
He remarked that for achieving the elevated tax collection target, the government seems to be relying largely on extracting more revenue from the existing pool of compliant taxpayers, rather than expanding the tax base.
He feared that instead of introducing meaningful reforms to bring untaxed sectors into the fold, the budget would result in increased discretionary powers for tax officials, burdening documented businesses and discouraging the economic activity. "This strategy of squeezing the formal sector could result in contraction of economic output rather than expanding it."
The Overseas Investors Chamber of Commerce and Industry (OICCI) has expressed disappointment over the government's limited progress in addressing inequitable corporate tax rates in the recent budget. While a marginal reduction in super tax was acknowledged, the OICCI reiterated the need for a comprehensive overhaul of tax structures to enhance Pakistan's competitiveness and attract foreign investment.
The chamber noted the absence of a meaningful reduction in government expenditure, which could have helped narrow the budget deficit. Fiscal discipline remains critical to ensuring macroeconomic stability. The OICCI urged the government to prioritise expenditure rationalisation in its budgetary measures.
It regretted the missed opportunity to broaden the tax base, particularly the absence of a concrete strategy to document Pakistan's Rs9 trillion cash-based informal economy – a critical measure for meaningful revenue enhancement and economic formalisation that the chamber had consistently advocated for.
Federal B Area Association of Trade and Industry President Shaikh Muhammad Tehseen commented that the federal government's announcement of the initiative to promote SMEs is a welcome move for owners of small and medium-sized businesses.
He urged the government to engage relevant stakeholders and incorporate their recommendations to ensure the success of the proposed business scheme, support the export-based sector and generate jobs for the youth.
According to the budget speech, on the directives of the PM, the Small and Medium Enterprises Development Authority (Smeda) has prepared a three-year business plan for 2024-27, which includes increasing SME financing, enhancing exports, building inter-industry linkages and promoting female inclusion in business.
The speech also mentioned the success of the SME Risk Coverage Scheme, which generated more than Rs311 billion in assistance for over 95,000 SMEs by May 2025. The government's target is to increase SME financing to Rs1,100 billion by 2028.
"The government should focus on reducing the cost of production to ensure benefits for industries, particularly through lower interest rates, utility charges and petroleum product prices, which will support the struggling SME units and attract both local and foreign investors to establish SMEs," Tehseen said.
SITE Association of Industry (SAI) President Ahmed Azeem Alvi stressed the need for clearer policies, faster tax refunds and digital reforms to support exporters and industries.
He said the government has recognised the need for relief within the Customs sector and intends to implement reforms. However, he noted that the full impact of these measures will only be clear once detailed budget documents are released.
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Express Tribune
an hour ago
- Express Tribune
Taxman gets arrest powers
Listen to article A National Assembly panel on Saturday approved special powers for tax authorities to arrest individuals involved in tax fraud, while it deferred the approval of another fiscal law that would have suddenly deprived government entities of their cash surpluses. Meanwhile, teachers and researchers will now be subject to full income tax, as the International Monetary Fund (IMF) did not agree to the government's proposal to extend the 25% income tax rebate for another fiscal year. Federal Board of Revenue (FBR) Chairman Rashid Langrial informed the National Assembly Standing Committee on Finance that the IMF had refused to extend the rebate. The committee, chaired by Syed Naveed Qamar, approved legal powers for the FBR to arrest taxpayers involved in tax fraud without prior court approval. However, additional safeguards were added to limit the discretionary use of these powers. At one point, Qamar remarked that the tax fraud "law has been borrowed from the National Accountability Bureau". The Senate Standing Committee on Finance had already cleared the controversial proposal. Now, following minor amendments by the National Assembly panel, the bill is expected to become law from July 1. Tax fraud has been defined as: "knowingly, intentionally or dishonestly doing any act or abets any action to cause loss of tax under this Act, including: using or preparing false, forged and fictitious documents including return, statements, annexures and invoices; false claim of input tax credit based on fictitious transactions; issuance of any tax invoice without supply of goods; tampering with or destroying of any material evidence or documents required to be maintained; generating fake input through manipulation of return filing system of the Board and making fake entries in the sales tax returns or in the annexures; and making fictitious compliance of section 73, including routing of payments back to the registered person, or for the benefit of the registered person, through a bank account held by a supplier or a purported supplier." Upon committing any of the above offences, the FBR will have the authority to arrest the individual without first seeking a warrant from any court of law. FBR Chairman Rashid Langrial said the criminality of tax fraud has been divided into two parts. In some cases, court permission will be required before an arrest is made. He explained that crimes such as suppression of taxable supplies under the Sales Tax Act, suppression or nonpayment of withholding tax for more than three months, dealing in goods liable to confiscation and making taxable supplies without registration will require court approval for arrest. According to the proposal, an Inland Revenue officer not below the rank of assistant commissioner – or any officer authorised by the board – may initiate an inquiry upon approval from the commissioner, if there is material evidence pointing to the commission of tax fraud or an offence warranting prosecution under the act. The inquiry officer shall have the powers of a civil court under the Code of Civil Procedure, 1908, including summoning and enforcing attendance of any person, examining on oath, requiring discovery and production of documents and receiving evidence on affidavits. The inquiry officer must complete the inquiry within six months. During proceedings, the officer must provide the accused with a chance to be heard and confront them with details of the alleged fraud. A final report will then be submitted to the commissioner, who may either approve a full investigation, request further details, or close the matter. Upon approval, the investigation must be completed within three months. The board may authorise a commissioner — through a three-member committee notified by the chairman — to issue an arrest warrant if the tax loss exceeds Rs50 million. Arrests will only be made if the accused fails to respond to three notices, attempts to flee, or is likely to tamper with evidence. When asked, Langrial said the accused can also be arrested at the airport if there is suspicion of an escape attempt. Cash surplus The standing committee held an extended discussion on a government proposal to assert full rights over the cash surpluses held by state-owned enterprises. The proposed amendment to the Public Finance Management Act aimed to grant the federal government control over these surpluses. "The federal government's budget deficit would never end, and it now wants to bankrupt the public sector companies," Syed Naveed Qamar said. Finance Minister Muhammad Aurangzeb argued that the companies were acting like "states within a state" and were not cooperating. He added that even government-nominated board members were not being heeded, blaming bureaucrats for the lack of progress. Minister of State for Finance Bilal Kayani withdrew the bill from the agenda, saying the government would reintroduce it after incorporating the committee's recommendations to strike a balance between fiscal discipline and autonomy. One major state-owned company was reported to be sitting on a cash surplus of Rs253 billion.
Business Recorder
6 hours ago
- Business Recorder
Prices of essential kitchen items show rising trend: BR survey
ISLAMABAD: The prices of essential kitchen items have witnessed an increasing trend during this week past against the previous week, revealed a survey carried out by Business Recorder (BR), here on Saturday. The survey observed a reduction in chicken prices from Rs15,000 to Rs10,400 per 40kg in the wholesale market, which in retail is being sold at Rs290 against Rs310 per kg and chicken meat price reduced from Rs530 to Rs500 per kg. Eggs' price went down from Rs9,000 to Rs7,000 per carton of 30 dozen which in retail is being sold in the range of Rs290-295 against Rs315-320 per dozen. Sugar price remained stable at Rs8,650 per 50 kg bag in the wholesale market, while in retail it is being sold at Rs180/190 per kg. Mutton and beef prices remained stable as normal quality mutton was available at Rs2,200 per kg, normal quality boneless beef at Rs1,400 per kg, and normal beef at Rs1,100 per kg. Various varieties of fishes are available in the range of Rs500 to Rs900 per kg. Interestingly, this time around the budget, contrary to the past there was no trend of upward fluctuations witnessed in the prices of soft drinks, cooking oil/ghee and cigarettes like daily use items. Wheat flour price remained steady as the best quality wheat flour ex-mill per 15kg bag price is available at Rs1,130 which in retail is being sold at Rs1,180 per 15kg bag and normal quality wheat flour per 15kg bag is available at Rs1,050 which in retail is being sold at Rs1,100 per bag. After a significant reduction of Rs1,400 per 15 kg bag in wheat flour price over the past one year. The tandoor owners in some parts of the twin cities started reducing the roti, naan and paratha prices as in some parts of the federal capital roti is available at Rs16 against Rs20, naan at Rs20 against Rs25 and paratha at Rs45 against Rs50. However, the bakers have not reduced the biscuit, bread and confectionery prices, which they had increased manifold after 2020 corona virus crisis, citing increase in ghee/cooking oil, and wheat flour prices. The prices of cooked food items remained stable as a cooked daal/vegetable plate at a normal hotel is available at Rs320, cooked beef plate at Rs550, cooked chicken plate at Rs500, cooked mutton at Rs750 and naan/roti is being sold at Rs25/30. No changes were witnessed in tea prices, as Lipton Yellow Label is available at Rs2,200 per 900 grams pack and Islamabad Tea is available at Rs1,800 per kg; normal quality turmeric powder is available at Rs600 against Rs700 per kg and normal quality red chilli powder at Rs800 against Rs900 per kg. No significant changes were witnessed in pulses prices as maash is available at Rs440 per kg, gram pulse at Rs300 per kg, whole gram pulse at Rs270 per kg, various varieties of bean lentils in the range of Rs450-550 per kg, moong price at Rs400 per kg, and masoor at Rs280 per kg. The prices of branded spices such as Shan, National, and others, also remained stable as a pack of 39 grams of spice is available at Rs140. The prices of the various varieties of rice remained stable as the best quality basmati in wholesale market is available at Rs12,800 per 40kg bag, which in retail is being sold at Rs350 per kg, normal quality basmati at Rs11,000 per 40 kg bag, which in retail is being sold at Rs310 per kg, and broken basmati at Rs8,500 per 40kg bag, which in retail is being sold at Rs235 per kg. Ghee/cooking oil prices remained stable as B-grade ghee/oil is available at Rs6,000 per carton of 16 packs in the wholesale market, which in retail is being sold at Rs460 per pack of 900 grams, while best quality cooking oil/ghee brands such as Dalda ghee price remained stable at Rs2,720 per 5kg tin and cooking at Rs2,720 per 5-litre bottle. Prices of packed milk brands such as Milk Pak and Olpers in the wholesale market remained stable at Rs2,250 per carton while in retail 250ml packed milk is being sold at Rs90. Fresh milk prices in some parts of the twin cities are being sold at Rs220 per kg while in some parts is still being sold at Rs230 per kg and yogurt price is stable at Rs250 per kg. No changes were observed in the prices of powder milk such as Nido and Lactogen as 400gram Nido powder milk is available at Rs1,320 and 200gram pack at Rs700 per pack. Bathing soaps' prices remained stable as family-size Safeguard and Dettol like soaps are available at Rs165 per pack, family size Lux at Rs150, and detergent prices went slightly up as Ariel Surf, Brite, Express Power and others are available at Rs570 against Rs550 per kg pack. The prices of various brands of cold drinks such as Pepsi, Coke, Miranda and others remained stable as family-size bottle is available at Rs230. Officially the Oil and Gas Regulatory Authority (OGRA) has fixed the price of liquefied petroleum gas (LPG) at Rs240.53 per kg, while retailers are selling 15kg domestic LPG cylinder at Rs4,000 against Rs3,615 OGRA fixed price reflecting an overcharging of Rs385 per cylinder. Moreover, the retailers through decanting are selling the LPG on further escalated rates as they charge Rs300-330 per kg, reflecting an overcharging of Rs60-85 per kg. LPG traders and distributors always blame the marketing companies for higher prices, saying the companies are supplying them the commodity on higher prices as a result retailers are left with no option other than shifting the price to the end consumers. According to LPG traders, the LPG marketing companies and distributors are earning billions of rupees profit by overcharging the consumers, while the OGRA which totally depends on district administration including police have totally ignored the enforcement of official commodity rates. Moreover, LPG distributors and retailers are freely selling LPG by decanting in violation of the laws as a result every other day LPG cylinder blasts are claiming precious lives. Overall vegetable and fruit prices witnessed an increasing trend as potatoes in wholesales market went up from Rs2,500-4,200 to Rs2,600-4,500 per quintal, while in retail potatoes are being sold in the range of Rs55-70 against Rs50-65 per kg; onion price in wholesales market went down from Rs1,300-2,200 Rs1,200-2,000 per quintal, in retail onions are being sold in the range of Rs30-45 per kg and tomato price went down from Rs200 to Rs170 per basket of 15kg, which in retail are being sold in the range of Rs30-40 per kg. Ginger price is stable at Rs2,200 per 5kg in the wholesale market, which in retail is being sold in the range of Rs525-550 per kg, local garlic price went up from Rs750 to Rs850 per 5 kg which in retail is being sold at Rs220 against Rs200 per kg, China garlic price went up from Rs1,000 to Rs1,100 per 5kg in the wholesale market which in retail is being sold in the range of Rs250-300 against Rs240-270 per kg. Capsicum price went up from Rs230 to Rs250 per 5kg in the wholesale market which in retail is being sold in the range of Rs75-80 against Rs70-75, prices of various varieties of pumpkins went up from Rs160-225 to Rs200-250 per 5kg in wholesale market, which in retail are being sold in the range of Rs55-75 against Rs50-75 per kg; various types of tinda prices went up from Rs100-650 to Rs130-700 per 5kg which in retail are being sold in the range of Rs45-200 against Rs40-180 per kg; eggplant price went up from Rs325 to Rs350 per 5kg, which in retail are being sold at Rs85-100 against Rs80-90 per kg; cauliflower price went up from Rs350 to Rs450 per 5kg in wholesale market, which in retail is being sold in the range of Rs120-140 against Rs100-120 per kg and cabbage price went up from Rs175 to Rs225 per 5kg, which in retail is being sold at Rs65-75 against Rs50-60 per kg. Okra price went up from Rs120 to Rs130 per 5kg in wholesale market which in retail is being sold at Rs50-60 per kg, Bitter gourd price is stable at Rs250 per 5kg which in retail is being sold in the range of Rs65-75 per kg, green chilli price went up from Rs250-350 to Rs300-400 per 5kg in the wholesale market which in retail are being sold in the range of Rs100-130 against Rs90-100 per kg, beetroot price went up from Rs225 to Rs250 per 5kg which in retail is being sold at Rs70-75 against Rs60-70 per kg, local carrot price is stable at Rs150 per 5kg which in retail is being sold at Rs50-55 per kg and cucumber price went up from Rs170 to Rs225 per 5kg, which in retail is being sold at Rs65-75 against Rs50-55 per kg. Fresh bean price went up from Rs400 Rs450 per 5kg which in retail are being sold at Rs120-140 per kg against Rs100-120 per kg, Yam price went up from Rs900 to Rs600 per 5kg, which in retail is being sold at Rs190-200 against Rs220-230 per kg; turnip price is stable at Rs150 per 5kg which in retail are being sold in the range of Rs50-55 per kg; peas price went down from Rs750 to Rs650 per 5kg which in retail are being sold in the range of Rs180-200 against Rs230-240 per kg; radish price is stable at Rs100 per 5kg which in retail is being sold at Rs35-45 per kg, spinach is available at Rs150 per 5kg which in retail is being sold at Rs15-20 per bundle of 200 grams and coriander is available at Rs250 per 5kg in wholesales market which in retail is being sold at Rs30-35 per bundle of 250 grams. Fruit prices witnessed an upward trend as various types of local apples are available in the range of Rs150-500 against Rs140-450 per kg, Iranian dates at Rs400-450 per kg, Bananas prices went up from Rs80-190 to Rs100-200 per dozen. Various varieties of melons are being sold in the range of Rs50-100 against Rs40-120 per kg; Chikoo at Rs275-300 against Rs250-275 per kg, papaya at Rs350-380 against Rs320-350 per kg and falsa at Rs350-400 against Rs200-230 per kg. New arrival mangos in the range of Rs150-250 per kg, cherry in the range of Rs600-750 per kg, peach in the range of Rs150-250 per kg, apricot in the range of Rs175-300 per kg. Business Recorder has noted a significant difference between the wholesale market prices, official prices fixed by market committees which consists of commissioners, deputy commissioners (DCs), assistant commissioners (ACs), the special price control magistrates, representatives of wholesalers, retailers and general public. Whenever the retailers are mentioned as significantly overcharging the consumers and not following the official price list, they are arguing that some quantity of fruits, vegetables and other products they purchase from the wholesale market always remain rotten. Business Recorder has observed and repeatedly reported that retailers, vendors, and other sellers are not displaying official price lists of household items at a prominent place and are not even providing on demand, which they are legally bound to provide the consumers and display at a prominent place. Copyright Business Recorder, 2025
Business Recorder
6 hours ago
- Business Recorder
IMF rejects tax rebate for teachers, researchers: FBR
ISLAMABAD: Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial, Saturday, informed the National Assembly Standing Committee on Finance that the International Monetary Fund (IMF) has rejected proposal of the FBR to allow 25 percent tax rebate to teachers and researchers from July 1, 2025. The FBR chairman informed the committee that the FBR has twice approached the fund, but they have not agreed. The IMF wants harmonisation of taxes and not allowed the said tax rebate to teachers/researchers. However, the government can give subsidy from budget if possible. MNA Nafeesa Shah stated that the government can give some kind of special allowance to teachers. Budget FY26: Aurangzeb announces major tax relief for salaried class, solar sector State Minister of Finance Bilal Azhar Kayani regretted that there is no fiscal space available in 2025-26. The National Assembly Standing Committee on Finance approved the revised procedure of arrest in cases of tax fraud as approved by Senate Standing Committee on Finance. The FBR chairman informed the committee that the FBR has its own jails to keep persons involved in tax fraud and it can also use other jails for this purpose. The government has incorporated four major safeguards for allowing arrests on tax frauds in order to avoid misuse of powers. In the first pre-requisite, the minister said that the accused of tax fraud would be arrested where there was a fear of his escape, but it would be done with the approval of three members of the Board, including FBR Member IR (Operations) and FBR Member Legal. The tampering of proof could be the second reason, and the third reason could be tax fraud amounting to Rs50 million. The fourth condition of the arrest, he said, would only be possible if someone received three notices but not bothered to respond. The FBR chairman informed that the relevant clause of income tax exemption to pensioners has been deleted from the Income Tax Ordinance to tax only pensions above Rs10 million. The committee recommended that the withholding tax should be increased from 0.6 per cent to 0.8 per cent on cash withdrawals from banks by non-filers. However, the committee rejected the proposal of Senate Standing Committee on Finance to raise tax rate from 0.6 per cent to 1 percent. On the taxation of salaried individuals, the FBR chairman informed that only one per cent tax would be applicable on salaried individuals where taxable income exceeds Rs600,000 but does not exceed Rs1,200,000. Copyright Business Recorder, 2025
