The Overseas Investors Chamber of Commerce and Industry (OICCI) held a high-level consultation meeting with Minister of State for Finance and Revenue Bilal Azhar Kayani as part of ongoing preparations for Pakistan’s Federal Budget 2026–27, presenting a comprehensive set of tax reform recommendations aimed at improving investment conditions and expanding the country’s tax base.
The meeting, held on April 19, 2026, also included virtual participation from Tax Policy Office Director General Dr. Najeeb Memon. Senior leadership from OICCI member companies participated in the engagement, including President Yousaf Hussain, Secretary General M. Abdul Aleem, and Executive Director Kashif Shafi. The session formed part of the Ministry of Finance’s structured consultation process with key industry stakeholders ahead of the upcoming budget cycle.
During the discussions, OICCI highlighted concerns regarding the currently high effective tax burden on the corporate sector. The chamber emphasized that the cumulative impact of multiple taxation layers continues to affect business competitiveness and investment potential. As part of its proposals, OICCI recommended reducing the corporate tax rate to 28 percent in fiscal year 2026–27, followed by a phased reduction to 25 percent over the next three years. It also called for the gradual elimination of the super tax, arguing that the existing structure places excessive pressure on formal corporate entities.
To address personal income taxation, particularly for skilled professionals, the chamber proposed abolishing the super tax and removing the 10 percent surcharge on higher-income salaried individuals. It further suggested capping the maximum personal income tax rate at 25 percent to support talent retention and improve labor market competitiveness. Additional recommendations included rationalizing withholding tax mechanisms, reducing sales tax on goods from 18 percent to 17 percent with a medium-term target of 15 percent, and reviewing minimum tax and alternate minimum tax frameworks to improve efficiency and simplify compliance processes.
OICCI stressed that the priority for fiscal policy should be the expansion of the tax base rather than increasing the burden on already compliant taxpayers. It emphasized the importance of bringing under-taxed sectors into the formal tax net, including agriculture, retail and wholesale trade, real estate, and services, ensuring that all segments contribute proportionately to economic activity. During the engagement, foreign investors also raised operational challenges affecting business activity, including compliance burdens and administrative inefficiencies. The chamber highlighted that addressing these concerns would be essential for improving investor confidence and facilitating smoother business operations.
A key focus of the discussion was the role of export-oriented industries in driving Pakistan’s medium-term economic growth. OICCI emphasized the need for targeted policy support to enhance export competitiveness and suggested that, where necessary, flexibility within international financial program frameworks could help maintain industrial momentum. The chamber reiterated that strengthening export capacity remains critical for sustainable economic expansion, particularly in a global environment marked by trade volatility and tightening financial conditions.
Concluding the session, OICCI reaffirmed its commitment to working closely with the government to develop a transparent, predictable, and investment-friendly tax framework. It stated that such a system should support compliance, encourage domestic and foreign investment, and facilitate Pakistan’s transition toward a more sustainable, export-led growth model driven by broader participation across all economic sectors.
Follow the PakBanker Whatsapp Channel for updates across Pakistan’s banking ecosystem