PSX proposes tax adjustments to spur economic growth in Pakistan’s 2024-25 federal budget

Karachi, The Pakistan Stock Exchange (PSX) has submitted a comprehensive set of tax proposals to the Ministry of Finance and the Federal Board of Revenue for the upcoming 2024-25 federal budget, aiming to stimulate economic growth and enhance employment through better resource allocation and documentation.

According to information available from the Pakistan Stock Exchange (PSX), the proposed measures are designed to align tax rates across various sectors and instruments to foster a level playing field and promote investment. Noteworthy suggestions include aligning the Capital Gains Tax (CGT) on listed securities with that on immovable property and similar alignment for derivatives and futures traded on PSX with those on the Pakistan Mercantile Exchange. The PSX also recommends rationalizing the dividend tax rate to encourage investments in stocks and addressing double taxation on corporate profits.

Additional proposals focus on enhancing documentation across the economy, especially in the real estate sector through incentives for Real Estate Investment Trusts (REITs) and promoting capital market expansion by offering tax credits for companies undergoing Initial Public Offerings (IPOs) and reinstating tax credits for investments in shares and mutual funds.
These initiatives are expected to contribute to a more robust economic framework, supporting the PSX’s role in capital formation and economic development in Pakistan.