ISLAMABAD: The Pakistan Business Council (PBC) has initiated discussions with the government, aiming to establish a robust fiscal policy framework serving long-term objectives of promoting investment, creating jobs, and supporting exports.

PBC Chairman Shabbir Diwan and Vice-Chairperson Ms Zeelaf Munir, CEO Ehsan Malik, and other office-bearers met with Finance Minister Muhammad Aurangzeb and Commerce Minister Jam Kamal on Monday.

The meeting was part of the ongoing consultation process initiated by the finance and commerce ministries ahead of formulating the federal budget 2025-26. Both ministries have sought proposals from all stakeholders.

An official announcement said the PBC delegation presented a comprehensive set of proposals and recommendations for fiscal policy and the tax regime for FY26 and beyond. These proposals aim to align the country’s economic objectives and ensure sustainable growth and social development.

The PBC delegation highlighted key economic objectives, including balancing the external account through exports and indigenisation, balancing the fiscal account by formalising the economy and broadening the tax base.

They emphasised the importance of fostering business growth, creating jobs, and driving socio-economic development, ultimately boosting productivity across sectors.

The PBC delegation also recommended a fair distribution of the tax burden, imposing taxes at competitive rates, and establishing long-term policy predictability.

They also called for simplifying, unifying, and digitising the tax return process while minimising the impact on businesses’ cash flow.

The PBC delegation shared several proposals to broaden the tax base, including encouraging non-filers to join the tax net, incentivising tax filers, enhancing transparency, improving accountability, and reducing the prevalence of benami transactions.

They also underscored the need to discourage the parking of untaxed money in informal sectors, promote the documentation of the economy, and reduce harassment of taxpayers.

Finance Minister Muhammad Aurangzeb assured the delegation that FBR teams would engage with the PBC in the coming days to examine and consider all suggestions thoroughly.

He also announced that the government had decided to move the tax policy unit out of the FBR and house it within the Ministry of Finance to safeguard the integrity of tax policy from revenue collection pressures.

He stressed the government’s resolve to increase the tax-to-GDP ratio to 13.5pc within three years. This goal will be pursued by broadening the tax base by leveraging technology, improving data analytics, and streamlining tax processes.

In a meeting with Commerce Minister Jam Kamal, the delegation emphasised the importance of the cost of doing business in Pakistan and maintaining a tariff structure that avoids distortions in the industry and supports its growth.

Published in Dawn, January 28th, 2025