Karachi: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed relief following the reversal of stringent budgetary measures initially proposed in the federal budget for 2025-26. Atif Ikram Sheikh, President of FPCCI, announced the resolution of these measures, which had raised concerns of potential harassment within the business community.
Mr. Sheikh highlighted collaborative efforts that involved meetings with high-ranking officials, including former caretaker Federal Minister for Commerce Gohar Ejaz and Patron-in-Chief of UBG S. M. Tanveer. These discussions, which included various chambers and associations, were pivotal in addressing the concerns.
The FPCCI led delegations to various government leaders, including Prime Minister Shehbaz Sharif and Field Marshal Syed Asim Munir, to negotiate and resolve the issues surrounding the Finance Bill 2025. The discussions addressed several sections of the Sales Tax Act and the Income Tax Ordinance, resulting in significant amendments.
One notable change involved Section 37A of the Sales Tax Act, which initially allowed broad arrest powers to FBR officers. These powers have now been restricted to serious cases of sales tax fraud, with mandatory approval required from a specially formed committee before investigations proceed.
Additionally, a Grievance Redressal and Monitoring Committee has been established to ensure due process is maintained, with fortnightly reviews of all arrests. Adjustments to Section 21(s) of the Income Tax Ordinance now consider cash received in bank accounts as banking transactions, easing operational challenges for businesses.
The FPCCI's advocacy also resulted in a commitment from the FBR to engage in meaningful consultations before altering input tax restrictions under Section 8B of the Sales Tax Act. Moreover, grievances under Section 40B have been addressed with the formation of a grievance committee.
The implementation of e-invoicing, another concern, is proposed to be phased over six to nine months, addressing the practicality issues businesses face. The FPCCI has also successfully negotiated with the Sindh Government to reduce the Infrastructure Development Cess on solar panels, a move aimed at promoting clean energy.
Abdul Mohamin Khan, VP and Regional Chairman Sindh, FPCCI, confirmed that the Sindh Government has agreed to lower the IDC rate from 1.85% to 1.0%, contingent on businesses withdrawing court cases against the levy.
The FPCCI continues to advocate for the business community, emphasizing consultation and collaboration with government bodies to foster a more favorable business environment.