{"id":33618,"date":"2026-06-17T07:58:01","date_gmt":"2026-06-17T07:58:01","guid":{"rendered":"https:\/\/gsrra.com\/?p=33618"},"modified":"2026-06-17T07:58:05","modified_gmt":"2026-06-17T07:58:05","slug":"pakistani-business-leaders-say-budget-tax-relief-can-spur-growth-to-4-percent-boost-exports","status":"publish","type":"post","link":"https:\/\/gsrra.com\/?p=33618","title":{"rendered":"Pakistani business leaders say budget tax relief can spur growth to 4 percent, boost exports"},"content":{"rendered":"\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.arabnews.com\/sites\/default\/files\/styles\/n_670_395\/public\/2026\/06\/14\/4721565-573194280.jpg?itok=l1Xw4VmW\" alt=\"Pakistani business leaders say budget tax relief can spur growth to 4 percent, boost exports\" title=\"A vendor selling clothes waits for customers at his store in a market in Lahore on June 12, 2026. (AFP\/ file)\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">A vendor selling clothes waits for customers at his store in a market in Lahore on June 12, 2026. (AFP\/ file)<a href=\"https:\/\/www.arabnews.com\/#facebook\" target=\"_blank\" rel=\"noreferrer noopener\"><\/a><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Industry leader says tax cuts could help increase exports to as much as $80 billion if energy costs are lowered<\/li>\n\n\n\n<li>Economists say the 4 percent growth target is \u2018ambitious\u2019 given regional tensions and trade disruptions at the Afghan border<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Pakistani business leaders and investors said on Saturday that the tax relief measures announced in the Federal Budget 2026-27 could help the government achieve its 4 percent economic growth target and significantly boost the country\u2019s exports, given that energy prices become competitive.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Pakistan on Friday unveiled a Rs18.8 trillion ($67.5 billion) annual fiscal plan, raising defense spending and setting ambitious revenue targets as the government seeks to sustain an International Monetary Fund-backed economic recovery amid regional tensions and pressure on public finances.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Business leaders from the Federation of Pakistan Chambers of Commerce &amp; Industry (FPCCI) welcomed the tax incentives, including reductions in transaction taxes to support housing and construction, and measures aimed at boosting agricultural productivity.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cTheir (government\u2019s) targets will be fulfilled. Our exports, which have stopped growing for the past four years, will increase. This is a very big incentive,\u201d FPCCI President Atif Ikram Sheikh told Arab News on Saturday.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe industry will run, employment will increase, and revenue will be generated.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Islamabad aims to expand the economy by boosting exports to $32.9 billion and keeping imports at around $70 billion in the next fiscal year, according to budget documents.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The new fiscal plan reduced advance income tax and minimum tax on exports from 2 percent to 1.25 percent and abolished the 1-7 percent \u2018super tax\u2019 on six slabs for medium-sized businesses earning between Rs150 million ($539,209) and Rs500 million ($1.8 million) annually.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The government has also announced plans to build 150,000 affordable and climate-resilient housing units across Pakistan under its sustainable urban development program.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">To stimulate construction activity, withholding tax on property transfers has been reduced from 2.5 percent to 1.25 percent for buyers and from 5.5 percent to 2.75 percent for sellers.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Other measures include a 4.5 percent cut in withholding tax on international transactions made through bank credit and debit cards, the abolition of capital value tax on foreign assets, and a fixed Rs25,000 tax for retailers with annual sales of up to Rs200 million ($718,945).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Asked which measure was most significant, Sheikh pointed to the construction package.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe biggest package is construction. Sixty industries are allied to it. All those industries are [currently] closed. Steel, cement, tiles, ceramic, I don\u2019t know what else. So, all those will start running,\u201d he said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The FPCCI chief said exports could exceed the target if the government addressed energy costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to global fuel price tracking data shared by the country\u2019s energy ministry last month, Pakistan recorded the world\u2019s second-highest surge in domestic fuel prices since the start of the United States-Iran war that widely disrupted global cargo and energy supplies passing through the Strait of Hormuz, with petrol and diesel soaring 56 percent at one point in Pakistan.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The surge was second only to Myanmar\u2019s 90 percent increase and far exceeded hikes in the United States, Britain and several regional countries, though the government has since announced multiple reductions in fuel prices amid a ceasefire and ongoing negotiations between the US and Iran to end their war.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIf the energy price becomes competitive, then we can do $40 billion or even $80 billion in exports,\u201d said Sheikh, who thinks the government\u2019s 4 percent growth target was achievable despite regional tensions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cI think we will achieve that.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Investors also viewed the tax relief package positively.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cI think the relief that they have given is, firstly, the super tax relief is a very good relief which is positive for small businesses,\u201d Mohammad Shoaib, chief executive officer of Lucky Investment Ltd., which manages Rs125 billion ($449 million) in assets, told Arab News.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cSecondly, there is a lot of focus on exports. They have given benefits to the exporters. Thirdly, they have given some benefits to the real estate sector to stimulate the construction sector,\u201d he said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cAll in all, all three small things together have a positive impact. It will have a positive impact on growth.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Shoaib, however, cautioned that a 4 percent growth rate would not be sufficient to address Pakistan\u2019s long-term economic challenges.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cYou need to grow from 6-7 percent for the next 5-10 years to improve the living standard of the people and to grow the economy,\u201d he said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Still, the Lucky Investments Ltd. CEO said, the budget had a \u201cpositive approach in difficult circumstances.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Amreen Soorani, head of research at Al-Meezan Investments Management Limited, Pakistan\u2019s largest Shariah-compliant mutual fund managing more than Rs700 billion ($2.5 billion) in assets, said the government had targeted sectors with the greatest potential to support growth.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWhile the 4 percent growth target is certainly ambitious given regional tensions and trade disruptions at the Afghan border, the budget strategically fuels areas that may deliver,\u201d she said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cBy locking in major tax breaks for the booming IT sector, slashing super taxes for corporate exporters, and easing the tax burden on salaried professionals, the government seems to give a path for private sector expansion to some extent.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Pakistan\u2019s trade with Afghanistan has been suspended for months amid heightened tensions and sporadic cross-border skirmishes between the neighbors over a surge in militancy in Pakistan\u2019s western regions that border Afghanistan.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The proposed tax relief might not directly contribute to economic growth; however, it might continue to run \u201cthe economic wheel,\u201d according to Soorani.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe might not deviate much from the [4 percent growth] target,\u201d the economist added.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Reference Link:- <a href=\"https:\/\/www.arabnews.com\/node\/2647099\/pakistan\" target=\"_blank\" rel=\"noopener\">https:\/\/www.arabnews.com\/node\/2647099\/pakistan<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A vendor selling clothes waits for customers at his store in a market in Lahore on June 12, 2026. (AFP\/ file) Pakistani business leaders and investors said on Saturday that the tax relief measures announced in the Federal Budget 2026-27 could help the government achieve its 4 percent economic growth target and significantly boost the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":30129,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"aside","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[28616,30609,2076,26253,30612,483,30611,24590,30610,2906],"class_list":["post-33618","post","type-post","status-publish","format-aside","has-post-thumbnail","hentry","category-sample-category","tag-budget-2026-2027","tag-cotton-growing-2","tag-economy-2","tag-garments-2","tag-growth-4-percent","tag-pakistan-2","tag-tax-relief","tag-textile-industry-2","tag-textile-products","tag-trade-2","post_format-post-format-aside"],"jetpack_publicize_connections":[],"_links":{"self":[{"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/posts\/33618","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gsrra.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=33618"}],"version-history":[{"count":1,"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/posts\/33618\/revisions"}],"predecessor-version":[{"id":33619,"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/posts\/33618\/revisions\/33619"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gsrra.com\/index.php?rest_route=\/wp\/v2\/media\/30129"}],"wp:attachment":[{"href":"https:\/\/gsrra.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=33618"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gsrra.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=33618"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gsrra.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=33618"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}