Renowned economic analyst and former President of the Islamabad Chamber of Commerce, Dr. Shahid Rasheed Butt, has stated that the current budget suffers from multiple flaws, prioritizing short-term revenue targets over long-term economic stability. He emphasized the urgent and critical need for comprehensive reforms, including expansion of the tax base, documentation of the informal economy, and a clear shift toward export promotion to steer the country out of its economic crisis.
Addressing members of the business community, Dr. Butt said that instead of offering relief to existing taxpayers, the government has further burdened them while failing to take adequate measures against non-filers and unregistered business segments. The incentives announced in the budget are insufficient and ineffective in stimulating economic activity.
He warned that the continuous increase in tax burden is eroding business confidence. The extension of the super tax, he noted, is not only damaging the export sector but also discouraging industrial investment, an outcome detrimental to long-term growth. While acknowledging a few positive aspects of the budget, such as the reduction in the fiscal deficit and public debt, he asserted that they are not substantial enough to attract meaningful investment.
Dr. Butt highlighted that factors such as high interest rates, rising energy costs, and imbalanced taxation continue to create an uncertain investment climate. Without fully utilizing existing industrial capacities, new investments are unlikely to materialize.
He further stressed the need to modernize and reform the Federal Board of Revenue (FBR) in line with contemporary requirements.
Rather than relying on discretionary powers granted to FBR officials, an automated and science-based taxation system should be introduced to ensure that businesses can operate without fear or uncertainty.
The biggest challenge currently facing the country, he argued, is the declining investor confidence, which can only be restored through consistent, transparent, and business-friendly policies. Although the budget reflects the government’s intention to reduce the fiscal deficit and public debt, it also restricts the prospects for economic growth.
Dr. Butt concluded that if the government genuinely wants to promote economic development, it must roll back the super tax, expand the tax base, and reduce import dependency in favor of an export-led growth strategy. Otherwise, this budget may provide temporary relief to the economy, but the dream of sustainable development will remain unfulfilled.
