Finance Minister Muhammad Aurangzeb has announced that the government will hold a high-level meeting with business community leaders on July 15 (Tuesday) to explain the rationale behind recent tax-related amendments.
“This is not about pressure, we will engage with them and explain to them why the amendments were made,” said Aurangzeb during his address to the Overseas Investors Chamber of Commerce and Industry (OICCI) on Monday.
The move comes in the wake of growing discontent from chambers of commerce and trade associations, who have called for a nationwide strike on July 19 over new tax reforms, particularly those impacting retailers and traders.
Aurangzeb highlighted that the government has extended formal invitations to presidents of various chambers and trade bodies to discuss the proposed tax policies, including retail tax mechanisms and fiscal amendments introduced in the current budget.
Key Highlights from Aurangzeb’s Address:
1. Economic Stability and Debt Reduction:
The finance minister claimed that Pakistan’s fiscal health has improved, with a reduced reliance on borrowing.
He noted that the government has even started buying back its debt, enhancing bank liquidity and private sector lending.
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2. Privatization and Revival of Sick Units:
Aurangzeb urged banks to support the government’s privatization and restructuring agenda.
He also suggested that financial institutions collaborate with sponsors to revive non-performing industrial units.
3. Boost in Business Confidence:
A recent OICCI survey indicated a significant rise in overall business sentiment, which Aurangzeb attributed to the government’s economic reforms.
4. Repatriation and Refunds:
The government repatriated $2.3 billion in dividends and profits last fiscal year.
It also disbursed Rs75 billion in sales tax refunds to exporters in July, reinforcing its pro-business stance.
5. Structural Reforms in FBR:
Aurangzeb requested OICCI’s assistance in implementing structural changes at the Federal Board of Revenue (FBR).
He highlighted new safeguards in the sales tax regime to prevent evasion and abuse.
6. Simplified Tax Filing Process:
A new electronic income tax return form for individuals has been introduced.
The government is actively seeking recommendations from stakeholders to simplify tax procedures further.
7. Support for the Salaried Class:
Aurangzeb emphasized that the salaried segment received tax relief in the current budget, signaling the government’s intent to continue easing their burden in future policies.
8. Sector-Wise Commentary:
The finance minister noted strong performance in the pharmaceutical sector.
He stressed that real estate, agriculture, wholesale, and trading sectors must increase their contribution to Pakistan’s GDP.
The government is monitoring commodity prices monthly to ensure market stability.
