ISLAMABAD: The Pakistan Business Council (PBC) has proposed that the government gradually phase out the Super Tax by 2% annually until it is completely removed for non-export profits. The business body’s budget proposals include measures aimed at reducing tax burdens and promoting economic growth, particularly in the manufacturing, agriculture, and services sectors.
PBC recommended that the Super Tax on profits derived from exports be halved in 2025-26, with complete removal within three years. In the interim, the Super Tax should be applied progressively, based on profit slabs, with adjustments for inflation.
The council also suggested that listed companies with a minimum float of 25% in a year be eligible for a 1% reduction in the corporate tax rate. Additionally, PBC proposed that the formal sector’s responsibility for verifying tax credentials be limited to suppliers and customers registered directly with the Federal Board of Revenue (FBR), as displayed on the FBR portal.
As part of its recommendations, PBC called for the imposition of a 39% advance tax on electricity and gas bills for commercial and industrial customers who do not file tax returns. After a certain period, their utility connections should be disconnected.
The business council further advised that the tax rate on the formal corporate sector be reduced by 1% annually until it reaches 25%, aligning with tax rates in other emerging economies. PBC also urged the discontinuation of multiple taxation on inter-corporate dividends to encourage growth in the capital market and widen shareholding.
To support the formalization of the economy and combat brain drain, the PBC suggested reducing the tax burden on salaried employees. It emphasized the need to revive key sectors like manufacturing, agriculture, and services.
Additionally, PBC called for the removal of the tax on banks failing to achieve a 50% advance-to-deposit ratio (ADR), stating that the current policy fails to broaden lending to the private sector. The council also criticized the imposition of Capital Value Tax on overseas assets, noting that it yields minimal tax revenue while causing wealthy individuals to leave the country. PBC also voiced concerns over the taxation of cellular and fixed internet connectivity, arguing that it impedes the growth of the knowledge economy.
These proposals reflect PBC’s broader goal of fostering investment and creating a more sustainable, formalized economic environment.
