The office-bearers of the Hyderabad Chamber of Small Traders & Small Industry (HCSTSI), including President Muhammad Saleem Memon, Senior Vice President Ahmed Idrees Chohan and Vice President Shan Sehgal, jointly expressed their views on the federal and Sindh provincial budgets 2025–26, stating that although both governments have emphasized developmental objectives, digital reforms, and increased social sector allocations, there is a glaring lack of practical relief and structural support for small traders, manufacturers, and the broader business community.
President HCSTSI Saleem Memon stated that initiatives like the SME Policy 2024–27, digital reforms in the FBR, the introduction of an automated refund system, and faceless audits are commendable steps. However, without timely and effective implementation, these initiatives may remain merely on paper. He cautioned that the imposition of new taxes on Cash on Delivery (COD), Digital Services and Digital Presence could severely impact small and emerging online businesses that are still in their nascent stages.
Senior Vice President Ahmed Idrees Chohan pointed out the rise in withholding tax rates—from 1.5% to 2%, and in some cases up to 3.5% which would further escalate the operational costs for small and medium enterprises (SMEs). Moreover, the federal budget failed to announce any relief in industrial electricity tariffs, Time-of-Use rates, or subsidies for SMEs, which is a significant shortcoming considering the ongoing energy cost burden.
Vice President Shan Sehgal expressed concern over the increase in carbon levy, particularly the hike from 2.5% to 5% on furnace oil, stating that many small industries are still in transition and not yet fully equipped with renewable energy alternatives such as solar systems. This would further inflate production costs and hinder their competitiveness.
Speaking on the Sindh budget, President Memon welcomed increased allocations in education, health, and infrastructure development, as well as the abolition of several local levies, including professional tax, entertainment duty, and drainage cess, which may provide some financial breathing space to the public. However, he regretted the absence of direct financial packages, subsidy schemes, or ease-of-doing-business initiatives for SMEs, markets, and industrial zones within the provincial budget.
Senior Vice President Idrees Chohan emphasized that if the government is truly committed to job creation and business development, it must introduce a separate tax category for SMEs with lower rates, simplified return systems, easy installment options, and dedicated subsidy programs. He further stressed the need for stakeholder consultation before introducing any tax reforms or digital implementation measures, to ensure alignment with ground realities.
Vice President Shan Sehgal added that the dream of economic recovery and documentation cannot be realized until small businesses are given genuine operational support, trust, and financial protection. A budget that focuses solely on salaries, mega projects, and debt servicing fails to address the backbone of Pakistan’s economy the small business sector.
The Chamber leadership also strongly condemned the insertion of Section 37AA into the Sales Tax Act, calling it unconstitutional, undemocratic, and anti-business. They asserted that granting FBR officers the power to arrest any trader without a warrant, based merely on suspicion, and detain them for up to 14 days is a gross abuse of authority and a clear violation of human and economic rights. The Chamber demanded the immediate withdrawal of this provision, warning that failure to do so would result in nationwide legal and constitutional protests by the business community.
Furthermore, the Chamber condemned the federal allocation of a mere Rs 15 billion in the 2025–26 PSDP for the Sukkur–Hyderabad Motorway (M-6) a strategic infrastructure project with a total estimated cost of over Rs 400 billion. They noted that at this pace, the project may not be completed even in the next decade. Such a symbolic and insufficient allocation reflects a serious lack of commitment and is tantamount to an injustice against Sindh and its vital role in Pakistan’s trade and connectivity. The business community categorically rejects this approach and demands immediate and substantial funding to expedite the project.
