Karachi: Mian Zahid Hussain, a prominent business leader and Chairman of the National Business Group Pakistan, has expressed mixed reactions to the federal budget for 2025-26, which allocates a total of Rs 17,573 billion. While acknowledging the increased defense spending as a necessary step in light of regional tensions, Hussain voiced concerns about various measures that could potentially hinder the country's economic growth.

In his detailed response to the budget, Hussain highlighted that the federal and provincial governments are set to allocate Rs 3,800 billion for public welfare projects. However, he criticized the government's decision to impose taxes on renewable energy sectors, including an 18 percent sales tax on solar panel imports. Such measures, he argued, might stifle the growth of alternative energy resources, which are vital for the country's sustainable development.

Hussain also pointed out that the new budget would lead to price hikes in multiple sectors, impacting items such as automobiles, petroleum products, and consumer goods like coffee and chocolates. The introduction of increased levies and carbon taxes on petroleum products is expected to disproportionately affect middle-class and salaried individuals, potentially straining their financial stability.

Despite these concerns, Hussain praised the budget's emphasis on national security, calling it an essential response to India's perceived aggressive stance. He advocated for impact financing to drive development in sectors like education, health, and social welfare.

The budget's tax reforms and digital monitoring systems could improve revenue collection, according to Hussain, but he stressed the importance of providing facilitation to taxpayers. He welcomed the simplified income tax return form, which addresses the demands of SMEs and salaried workers.

Additionally, Hussain acknowledged the incentives in the housing and real estate sectors, predicting that reforms in the mortgage system could stimulate investment and make housing more affordable for the middle class. He noted that the modest salary and pension increases might offer some relief amid inflation but fall short of public expectations.

Hussain also commented on the ambitious tax collection target of Rs 14,100 billion, a 20 percent rise from the previous year’s actual collection. He emphasized the difficulty of meeting this target without expanding the tax base, yet recognized it as crucial for the country’s long-term economic stability.

In conclusion, Hussain urged the government to strategically invest in renewable energy, online businesses, and social sectors, emphasizing that these areas are essential for sustainable growth. He called for immediate reforms to solidify Pakistan's economic foundations in the face of ongoing challenges.