Mr. Atif Ikram Sheikh, President of FPCCI, has unequivocally stated that FPCCI vociferously opposes any further increase in taxation on already taxed classes or sectors, advanced tax collection, withholding tax (WHT) or any high-handed at-source deductions. The business, industry and trade community has had enough of unfair taxation, and it has reached a point where it can no longer withstand any additional burden, he added.

Mr. Atif Ikram Sheikh reiterated FPCCI’s stance that what we need in Pakistan is broadening the tax base, simplifying the tax filing system, making taxation reforms economically sensible, and ending harassment or maladministration in the taxation machinery—not these counterproductive, regressive, and contractionary taxation measures.

Mr. Sheikh informed that, as per FY24 data, WHT accounts for 70 percent of all the direct taxes collected in sales tax mode in the country, and this number is alarming, to say the least. On top of that, there are reports that the government may again raise WHT in the country to appease the IMF and show a healthy increase in tax collection. This is no good performance but a miserable attempt to show progress, he added.

The FPCCI President highlighted that the government would have to bring a supplementary finance bill 2025 or a mini-budget in order to implement any increase in WHT. Any mini-budget would lower investors’ confidence, cause a flight of capital, close industries, and fuel mistrust with exporters’ trading partners.

FPCCI Chief explained that WHT is collected in a sales tax collection mode and that, by any means, it is not reflective of any economic growth nor any positive trend in commercial activities or consumption in the country. It is pertinent to note that FBR has already suffered a shortfall of PKR. Ninety-eight billion in the first 2 months of FY25 – and it is estimated that it will further fall short by up to PKR. 100 billion in the third month of FY25. This is because there is no economic or export growth in the country, he added.