ISLAMABAD: The Sub-Committee of the Senate Standing Committee on Finance and Revenue on Tuesday reviewed the issues concerning the FBR taxation policies.
Senator Muhammad Talha Mahmood chaired the committee meeting at the Parliament House here.
Opening the discussion, Talha said the objective of the meeting was to explore mechanisms for promoting economic activity and creating a conducive environment for businesses.
He observed that many companies were either scaling down operations or leaving the country due to high energy costs and a burdensome tax regime.
FBR officials informed the committee that the import requirements and fiscal constraints had influenced the taxation measures.
They highlighted the government’s recent relief measures, including tax reductions for salaried individuals, cut in super tax, and elimination of super tax for exporters.
The committee was further told that the government had absorbed a revenue impact of approximately Rs359 billion to facilitate businesses and stimulate economic activity. The committee was also informed that exporters’ facilitation committees had been established in Karachi, Lahore, Sialkot, Faisalabad, Islamabad, and Multan to address tax concerns.
The business community expressed serious reservations about the current taxation framework.
Mian Zahid Hussain from the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) stated that the national policy appeared overly focused on revenue generation rather than economic growth. He emphasized the need to reduce advance and withholding taxes, rationalize customs duties, simplify audit procedures, and review factory surveillance mechanisms. He maintained that cumbersome tax procedures and compliance requirements had discouraged industrial growth and increased the cost of doing business.
Mr. Jadoon, vice president of a chamber of commerce, noted that despite Pakistan’s competitive labour costs, businesses continued to face significant challenges due to high electricity tariffs and regulatory burdens.
He stressed the need to broaden the tax base by bringing new sectors and businesses into the tax net rather than placing additional pressure on existing taxpayers.
Senator Talha questioned the effectiveness of the existing measures aimed at attracting foreign investment and sought details regarding mechanisms for investor protection and share transfers. The convener directed the authorities concerned to provide the sub-committee with a comprehensive briefing on the existing framework.
The committee expressed serious concern over the absence of secretary finance in the meeting.
Senator Talha directed that the secretary ensure attendance at the next meeting, warning that continued absence could result in the matter being referred to the Senate Privileges Committee.
He reiterated that sustainable economic growth could only be achieved through business-friendly policies and transparent governance and emphasized the need to appoint competent and honest officials capable of formulating policies that encourage investment, industrialization, and entrepreneurship. The committee was informed that the FBR was undertaking reforms to facilitate taxpayers, including the development of a mobile application for tax reimbursements and designation of specific facilitation days in major commercial centres across the country.
The committee also discussed the ongoing goods transport strike and its adverse impact on trade and economic activity.
Senator Talha expressed concern over delays in resolving the issue, noting that perishable goods were at risk of spoilage while businesses were incurring substantial losses due to container detention charges. He urged the government to immediately engage with affected stakeholders and resolve the matter to prevent further economic losses and safeguard Pakistan’s international business reputation.
