Karachi: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has voiced strong opposition to what it perceives as the Federal Board of Revenue’s (FBR) aggressive tax collection targets and methods, arguing that such strategies are unrealistic and detrimental to the business community. FPCCI President Mr. Atif Ikram Sheikh emphasized the need for a consultative approach to tax reform that involves all relevant stakeholders to ensure sustainable and effective tax collection.

According to Federation of Pakistan Chambers of Commerce and Industry, “FPCCI has repeatedly insisted that the FBR’s revised tax target of PKR 12.91 trillion for fiscal year 2024-25 is not only unachievable given the current economic conditions but also potentially harmful to business growth.” Mr. Sheikh highlighted the existing economic challenges, including a significant tax collection shortfall projected between PKR 100-150 billion in September 2024, following a PKR 99 billion deficit in July-August 2025.

The FPCCI President outlined several measures that the government should consider to improve the situation. These include facilitating exports, renegotiating power purchase agreements with independent power producers, reducing the key policy rate to align with the core inflation rate of around 8 percent, rationalizing energy tariffs, and enhancing law and order.

Mr. Sheikh criticized the high policy rate of 17.5 percent as economically nonsensical, urging for it to be brought to a single digit to reduce the cost of doing business and improve access to finance. He argued for a proactive, growth-oriented monetary policy to support the economic environment.

Furthermore, Mr. Sheikh stressed that FPCCI supports expanding the tax base through simplifying the tax system rather than continuing with inefficient administration and lack of stakeholder engagement. Special attention, he noted, should be given to micro, small, and medium enterprises (MSMEs), which require government support and incentives to grow and be integrated into the formal tax system.

Mr. Saquib Fayyaz Magoon, Senior Vice President of FPCCI, echoed this sentiment, stating that while the federation is ready to help facilitate discussions between the government and economic sectors, it cannot endorse measures that penalize businesses rather than encourage compliance and participation in the tax system.