Business leaders deliver mixed reactions to Budget 2025-26

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KARACHI: The business community has given a mixed response to the federal budget for the financial year 2025-26, in which business leaders from different forums express different views.

The President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Atif Ikram Sheikh, especially welcomed several steps to overcome harassment of taxpayers and introducing easy income tax return for SMEs and salaried individuals – FPCI. “This is a good decision of the government,” he said.

However, he criticized the tax collection target of Rs 2,500 billion, calling it unrealistic. He also described the reduction in super tax as a positive growth and welcomed the abolition of duty on the transfer of property, and called it a positive signal for the economy.

Overseas investors Chamber of Commerce and Industry (OICCI) expressed disappointment over limited progress in removing inequality in corporate tax rates. Recognizing a slight reduction in super tax, the Chamber reaffirmed the urgent need for a comprehensive rehabilitation of the tax structure to increase Pakistan’s competitiveness and attract foreign investment.

The OICCI also highlighted the lack of meaningful deductions in government spending, which can help reduce the fiscal deficit. It called on the government to prefer financial discipline and spending rationality to ensure economic stability.

The Chamber expressed regret over the wasting opportunity to expand the tax base, especially due to the absence of a concrete strategy, the informal economy based on Rs 9 trillion has been documented.

Nevertheless, the OICCI welcomed several positive reforms, including easy tax declarations for salaried individuals and small businesses, e-inviting nationwide rollout, and POS system expansion-chamber. However, he emphasized that his success depends on effective implementation, transparency and consistency.

The increase in the threshold of tax exemptions for salaried persons (from Rs 600,000 to Rs 1.2 million) and their tax rate (from 5.0 percent to 1.0 percent) were also welcomed. Although these measures are in line with the OICCI’s recommendations, the Chamber noted that they are still less than providing meaningful assistance to prevent the country’s ongoing mental drain.

The OICCI also supported the government’s imposition of tax exemptions in FATA and PATA as well as the implementation of stringent measures against non -compliance taxpayers, including restrictions on the purchase of property and vehicles, introducing foreign assets transfer and improving fine. It has been said that these measures are necessary to improve tax compliance and increase the base of the tax.

Despite these reforms, the OICCI said the budget failed to introduce change policies for the corporate sector. It emphasized the need for tax slabs to reduce the overall tax burden on business businesses to gradually require rationalism and promote more investment environment.

Businessman Group (BMG) Chairperson, Zuber Motiwala, labeled the federal budget 2025-26 labeled the “rocky budget” and expressed strong reservations in the name of lack of meaningful aid for both the realistic goals and the business community and the public. Addressing a press conference at the Karachi Chamber of Commerce and Industry (KCCI) after the Finance Minister’s budget speech, Motiwala said that the budget digitalization and the promotion of cashless economy were insufficient for encouraging exports or making industrial.

He criticized the government despite losing all major economic goals in the last financial year, including GDP growth and financial stability. He questioned how the new goals would be achieved, especially in view of the prevailing economic fragility, high inflation, and obstacles from the IMF.

KCCI President, Mohammad Javed Bulani, rejected the budget directly and argued that it failed to provide any concrete relief to any of the industrial sector or the common people. He said that inflation claims do not reflect the truth for families, where electricity bills are unbearable and basic needs are out of reach of rapidly.

Bilani criticized the absence of measures to reduce electricity rates and interest rates. He said that without solving these issues, neither industrial extension nor job creation is possible. He warned that unless the high energy and borrowing costs are immediately dealt with, there is a risk of eliminating many businesses.

He also expressed concern over the government’s heavy dependence on remittances and the IMF to handle the economy, and called it unstable. Bilani emphasized the importance of promoting a conducive environment for industrial growth – the only viable way to improve key economic indicators.

He criticized the minimum allocation for long -term delays infrastructure projects like KIV, and described it as a symbol of the government’s neglect of the government’s needs, despite the city’s contribution to the national economy.

The Bulani concluded that the government has once again failed to emphasize the business community’s repeated demands to expand the tax net and introduce structural reforms-both of these are necessary to ensure long-term economic stability.