Great Debate: Experts weigh challenges, prospects for economic growth after Budget 2025-26

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Following the unveiling of the Federal Budget 2025-26, renowned economists and top businessmen on Sunday gained insights on the possibility and possibilities of Pakistan during the special transmission of Geo News “Pakistan for Pakistan”.

Special transmission hosted by senior journalist Shah Zeb Khanzada, former Finance Minister Mafa Ismail, Arif Habib Group Chairman Arif Habib, Lucky Cement CEO Mohammad Ali Tabba, Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Vice President of the Chambers of Commerce and Industry.

Expressing his views on the federal budget, Tabba emphasized that the government should pay special attention to exports and expressed regret that the current budget did not have arrangements to improve it.

Tabba said that in last year’s tremendous debate, he had predicted contraction in the manufacturing sector on a large scale, which he said about the budget announcement proved true.

He believed that business growth was linked to the change of government mentality.

However, he expressed fear that instead of bringing non -filers into a tax net, the pressure on the filers only would only increase after the government’s recent financial measures.

The CEO of Lucky Cement said that the government has taken some steps to expand the tax net by introducing sanctions on non -filers, including property purchases and others.

Tabba suggested that it should also impose a travel ban on non -filers, which would force them to comply with tax regulations. He added that the government will have to take more steps to regain investors’ confidence, which is essential for business growth.

He also emphasized that the Federal Board of Revenue (FBR) system should be upgraded. Tabba has predicted that it will be difficult for the federal government to achieve its economic goals.

The chairman of the Arif Habib Group said that there was no action in the current budget which has implemented further tax measures on existing taxpayers.

However, he acknowledged that the government did not meet the expectations of taxpayers, including the salaried class.

He added that only “symbolic” measures were taken to provide relief to taxpayers despite promising to reduce taxes after receiving the financial space.

Habib said that after seeking approval from the International Monetary Fund (IMF), this year, it has proposed a budget of Rs 400 billion for implementation measures this year, which limited the government in the last financial year.

“There is no room for new investment in Pakistan,” he said, adding that there is already an ideal capacity in active sectors that should be used first. He described the new budget as a “growth and financial stability” budget.

They expected further reduction in interest rates and energy prices in the country. Habib acknowledged that in the presence of high interest rates, energy costs and tax rates, concerns about investing in new sectors of industries would prevail.

He praised the government’s move for the real estate sector and named the mortgage financing as “Game Changer”.

Mutta said that global corruption in oil and commodity prices has provided the opportunity to reduce the deficit of its current account.

He believed that the government, led by Prime Minister Shahbaz, lost the opportunity to provide relief to the salaried segment between the reduction of GDP per capita and the purchase of electricity for the past three years.

Muftia highlighted that the manufacturing sector is not developing in Pakistan compared to other countries in the region.

Regarding the super tax, the former finance minister said that it was imposed during the bank and the tobacco sectors, which was increased by the present government in all sectors, and now, it has been imposed on exports.

He criticized the government for imposing a super tax on the export sector.

He criticized the FBR, saying that he could not collect even one percent tax on the basis of his notice, and now, his officers were given the powers to arrest the trader.

Mufta remembered a high court order that prevented the authorities from arresting a person until the tax was decided or taking a decision on fraud.

Addressing the show, Vice President of FPCCI Anim said that the country would have to deal with the NFC award for taxing issues and to move forward.

He said that for the textile sector, domestic goods are targeted by sales tax which is a refundable but not sales tax on imported goods.

Anim said he suggested that the government should impose sales tax on both domestic and imported goods.

Referring to the government’s ineffective policies, the former chairman of the APTMA said that 120 textile mills have been closed and millions of people have become unemployed.

He added that the closure of textile mills means a waste of 750 MW power consumption.

He highlighted the positive steps taken by the government, which included a decrease in interest rates from 22 % to 11 % and energy rates.

Topline Securities CEO Sohail expressed his opinion, saying that the federal budget met expectations according to economic challenges in which a “stability” budget could be presented.

He called it a budget for the “financial stability and gradual growth” of the national economy. Economists predicted that economic growth in the next financial year would not be more than 4 %.

He believed that the tax rate on interest revenue has increased from 15 % to 20 % on banks, which will easily be reduced to $ 100 billion in production of Rs 50. Sohail advised that national savings should also be taxed.

Highlighting positive developments in the budget, the CEO of the topline securities said that the tax on pensions was low and they also spoke in favor of tax on the e -commerce sector. He said that the official sector of e -commerce is already paying 18 % of taxes and now, the informal sector will also fall into the tax net.

He added that this budget reflects the government’s fiscal deficit and the intention of reducing debt.

He said that this could not cause significant economic growth, but it would help the government to avoid rising and broken.

Bashir, director of Gul Ahmed Textile Mills, strongly opposed imposing super taxes on industries, especially the export sector, which he said would hinder economic development.

He believed that the super tax industries were taking the level that they could not restore profits. Bashir added that it would be only a short -term benefit, but the government sacrificed the future growth by imposing a super tax.