AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
KARACHI: Federal Minister for Finance and Revenue Muhammad Aurangzeb has announced that the transition from the Final Tax Regime (FTR) to the Normal Tax Regime (NTR) will be thoroughly reviewed in the next federal budget. This review aims to support Pakistan’s export sectors, particularly textiles, which are crucial to the country’s economy.
During a meeting at the Karachi Chamber of Commerce and Industry (KCCI), the Finance Minister assured stakeholders of the government’s commitment to addressing the challenges faced by export-oriented industries. Aurangzeb emphasized the need for reforms to enhance Pakistan’s competitiveness in global markets.
A significant structural reform highlighted in the meeting was the official separation of the Tax Policy Office from the Federal Board of Revenue (FBR). The Tax Policy Office, now under the Finance Division, will oversee budget preparation, focusing on economic value rather than fiscal arithmetic. The move is intended to bring stability and predictability to fiscal policy decisions.
Aurangzeb revealed that the government is forming eight private-sector-led working groups to develop practical economic recommendations by November 30. These groups will not include ministers, reflecting the Prime Minister’s intent to directly involve the private sector in economic planning.
The Finance Minister also highlighted the success of Pakistan’s automobile industry in finding new export markets in the GCC and Africa, demonstrating the potential for diversification. Immediate priorities include reducing tariffs on industrial raw materials to lower business costs and boost industrial growth.
Addressing taxation in FATA and PATA, Aurangzeb noted that income tax exemptions remain, but a 10 percent sales tax was imposed this year. He also shared positive developments in various sectors, including a projected 4 billion dollars in IT exports and the progress of the Reko Diq mining project.
Zubair Motiwala, Chairman of the Businessmen Group (BMG), expressed concerns over gas prices and the shift from FTR to NTR. He urged the government to negotiate effectively with the IMF to enhance exports and suggested that the business community be allowed to meet IMF officials.
KCCI President Rehan Hanif commended the Finance Minister for restoring economic stability but noted ongoing concerns, including the impact of current tax policies on industries in FATA and PATA. Hanif called for a review of tax laws and systems that affect business operations.
The meeting underscored the importance of ongoing consultation and reform to drive economic growth and improve Pakistan’s export performance.