The Korangi Association of Trade and Industry (KATI) has presented a comprehensive 72-page budget proposal to the federal government, earning commendations from government officials. Both the Prime Minister’s Secretariat and the Ministry of Planning have indicated that they will seriously consider KATI’s suggestions.

President of KATI, Johar Qandhari, expressed optimism about the government’s positive reception and the potential implementation of their proposals. He underscored that the budget proposals were meticulously and comprehensively prepared through extensive consultations with stakeholders, demonstrating KATI’s commitment to promoting industrialisation and addressing economic challenges.

The proposals highlight several key areas for reform. KATI strongly advocates for swift tax reforms and expanding the tax net. They recommend capping the income tax rate at a maximum of 15% and extending taxation to the agricultural sector under the normal tax regime. To combat inflation, KATI suggests reducing the interest rate to single digits.

Additionally, the proposals call for reducing corporate tax to 20% and implementing a withholding tax regime. KATI proposes reducing the capital gains tax period from three years to one year to boost the real estate sector. They also recommend abolishing or refraining from auditing the minimum tax regime to improve direct cash flow.

Qandhari further outlined the need for a more efficient sales tax and value-added tax collection system, starting with an initial imposition of a 5% sales tax. He hoped the federal government would incorporate these stakeholder consultations into the budget preparation process, reduce the tax rate, and bring tax defaulters into the tax net.

The proposals also emphasize the potential benefits of increasing production capacity and reducing the prices of electricity, gas, and energy. These measures, Qandhari argued, would not only spur industrialization but also drive Pakistan toward significant economic development.

Qandhari reiterated KATI’s commitment to collaborating with the government to ensure that the budget reflects the needs of the industry and broader needs, paving the way for sustainable economic growth.