The Overseas Investors Chamber of Commerce and Industry has called on the Federal Board of Revenue to urgently release Rs96.6 billion in pending income and sales tax refunds, stressing that prolonged delays are undermining investor confidence and restricting financial liquidity for multinational companies operating in Pakistan.
In a formal communication addressed to FBR Chairman Rashid Mahmood Langrial, OICCI highlighted that as of September 2025, Rs62.2 billion in income tax and Rs34.4 billion in sales tax refunds remain outstanding. The chamber acknowledged some progress made by the tax authority but emphasized that the backlog is still significant and has created an environment of financial uncertainty for its member companies.
OICCI represents more than 200 multinational corporations in Pakistan across key industries including energy, manufacturing, technology, healthcare, and finance. The chamber has long advocated for a predictable and transparent fiscal environment, urging the government to adopt structured refund mechanisms to avoid disruptions to business operations.
In the letter, OICCI stated that despite the FBR’s increased use of digital systems and improvements in procedural documentation, delays in refund processing remain a critical issue. The chamber underscored that these delays directly affect business planning, investment timelines, and working capital management for foreign investors who contribute heavily to Pakistan’s economy.
M Abdul Aleem, OICCI’s Chief Executive and Secretary General, noted that refund delays disrupt the strategic operations of multinational corporations. “Their sustained contribution to the economy in capital investment, employment generation, and technology transfer depends on the state’s ability to meet its fiscal commitments in a timely manner,” he stated in the communication.
The letter was also shared with Muhammad Aurangzeb, the country’s finance minister, along with other key officials. OICCI stressed that resolving these refund claims would not only ease immediate liquidity pressures but also send a strong signal of policy stability to global investors evaluating Pakistan as an investment destination.
According to OICCI, 74 member companies have pending claims with the FBR, primarily based in Karachi, with some in Islamabad and Lahore. These include firms from the power, chemicals, and industrial sectors, including K-Electric and several manufacturing companies. A businessman familiar with the matter said that refund processing is often tied to fiscal management priorities, with decisions coming from the top level rather than automated systems.
“The companies keep paying their dues. OICCI members contribute nearly Rs10 billion in taxes every day, but once they pay, getting a refund back becomes an uphill battle,” the businessman said. “These delays create serious liquidity constraints and harm Pakistan’s image among international investors.”
He further pointed to bureaucratic inefficiencies within the FBR, describing it as a fragmented structure with each department chasing daily revenue targets. This, he added, undermines the broader objective of creating a stable and growth-oriented business climate.
The chamber also referenced the recent exit of Procter & Gamble from Pakistan as a cautionary example of the pressures facing multinationals in a volatile economic environment. While P&G’s exit was influenced by currency fluctuations and operational challenges, OICCI emphasized the importance of building investor trust through predictable fiscal practices, including timely refunds.
“When P&G entered Pakistan, the dollar was at Rs60. Now it’s around Rs280. That kind of volatility makes it extremely hard for any global CEO to justify continued investment,” the businessman remarked. “When companies leave, the loss goes beyond sales. It affects technology transfer, skills development, and long-term economic capacity.”
OICCI reaffirmed its willingness to collaborate with the FBR to find workable solutions and streamline refund procedures. The chamber believes that prompt resolution of refund claims would improve Pakistan’s ease of doing business ranking, encourage new foreign entrants, and help stabilize the investment ecosystem.
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