PTC welcomes export-focused budget measures, calls for additional tax relief

The Pakistan Textile Council (PTC) has welcomed a series of business and export-oriented measures introduced through the Finance Bill 2026-27, saying the proposals would improve the competitiveness of Pakistan’s export sector and encourage investment.

In separate letters to Finance Minister Senator Muhammad Aurangzeb and Minister of State for Finance Bilal Azhar Kayani, PTC Chairman Fawad Anwar expressed support for the government’s reform agenda, describing the budget measures as a positive step toward export-led economic growth while maintaining fiscal discipline.

The council particularly praised the government’s decision to abolish super tax on exporters, terming it a landmark measure that would reduce the effective tax burden on export industries and strengthen investor confidence.

PTC also welcomed the reduction in the combined levy on export proceeds from 2% to 1.25%, saying the move would ease liquidity constraints and improve cash flows across the export sector.

The textile body further appreciated the rationalisation of super tax for companies with income of up to Rs500 million, noting that the relief could support reinvestment and expansion within the productive corporate sector.

According to the council, the restructuring of income tax slabs for salaried individuals would increase disposable incomes, stimulate domestic demand and strengthen the workforce supporting Pakistan’s export industries.

While endorsing the overall direction of the budget, PTC urged the government to consider additional measures aimed at enhancing export competitiveness.

The council proposed that the reduced 1.25% turnover tax on exporters be treated as a full and final discharge of income tax liability, arguing that such a framework would provide certainty, reduce tax-related disputes and encourage new investment.

Alternatively, it suggested reducing the corporate income tax rate on export income to 15% if the proposed final tax treatment cannot be implemented immediately.

PTC said a lower tax rate would align Pakistan more closely with regional competitors, including Bangladesh and Sri Lanka, and help attract export-oriented investment.

“Finance Bill 2026-27 reflects the government’s commitment to export-led growth and economic stability,” Anwar said, adding that further refinements could help ensure the benefits of the proposed measures are fully passed on to exporters and support long-term export expansion.