Chambers, traders give mixed reaction to Budget 2026-27, seek stronger support for exports and industry
Business leaders, industrialists and chambers of commerce across Pakistan Friday offered a mixed response to the federal Budget 2026-27, welcoming relief measures for the salaried class, construction sector and property market while expressing disappointment over the lack of incentives for exporters, small industries and the agriculture sector.
The leadership of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) said the budget contained some positive measures but fell short of the business community's expectations for economic growth and industrial revival.
FPCCI President Atif Ikram Sheikh congratulated the government on presenting its third budget and acknowledged that Pakistan had shown improvement despite economic difficulties. However, he said economic growth remained below target and industrial competitiveness continued to be a major challenge. He noted that business activity had declined during the past three years and the private sector had expected a stronger growth-oriented budget.
FPCCI Senior Vice President Saqib Fayyaz Magoon welcomed the Rs1 trillion development allocation and termed the abolition of super tax on income up to Rs500 million a positive step. He also appreciated the reduction in property-related taxes and the abolition of capital value tax on foreign assets. However, he criticized the government's decision not to restore the fixed tax regime for exporters and opposed additional taxation on purchases from unregistered suppliers.
Magoon said the business community had expected incentives for the alternative energy sector and measures to reduce industrial production costs. He warned that increasing penalties and raising the minimum tax rate from 0.25 percent to 0.50 percent could increase uncertainty and harassment of businesses. He also regretted that no incentives had been announced for overseas Pakistanis who sent record remittances of about $42 billion.
FPCCI Vice President Aman Paracha expressed disappointment over the absence of a package for small and medium-sized industries. He said the business community had proposed incentives on electricity, gas, machinery and taxation but no significant measures were announced. He also criticized the lack of a clear roadmap for agriculture and said the cotton sector, which is facing serious challenges, had been ignored.
Karachi business leaders criticise export measures
In Karachi, Businessmen Group Chairman Zubair Motiwala said exporters had expected more meaningful relief following the economic survey.
He expressed disappointment that the fixed tax regime for exporters had not been restored and said there was no comprehensive energy-related programme in the budget. Motiwala stressed that exports, not remittances, were the key to sustainable economic growth and called for faster refund payments and greater support for industrial expansion.
He praised the reduction in the tax burden on the salaried class, the incentives for real estate and construction, and the government's progress on automation and faceless tax systems. However, he described the overall budget as inadequate and argued that most of the burden continued to fall on existing taxpayers rather than new entrants to the tax net. He also criticised the allocation of only Rs10 billion for Karachi's K-IV water project, saying the city required much greater investment.
Lahore chamber welcomes tax relief but seeks industrial incentives
President of the Lahore Chamber of Commerce and Industry Faheem-ur-Rehman Sehgal welcomed the reduction in income tax rates for salaried individuals and appreciated relief measures for traders under the fixed tax scheme.
Business leaders in Lahore, including Tanveer Ahmed Sheikh and SM Tanveer, said the budget lacked a comprehensive strategy for industrial growth, ease of doing business and the development of industrial zones. They argued that more support was needed for small industries and industrial estates in major cities.
SM Tanveer praised the increase in defence spending to Rs3 trillion, reductions in property transaction taxes, abolition of the late filer category and improvements for the construction and housing sectors. He also welcomed the partial abolition of super tax and described the budget as development-oriented, though he said the salaried class deserved even greater relief.
Multan chamber calls budget a missed opportunity
Acting President of the Multan Chamber of Commerce and Industry Azhar Javed Baloch described the budget as a repetition of old ideas and questioned why greater emphasis had not been placed on broadening the tax base.
He demanded immediate reductions in electricity and gas tariffs, criticized the increase in petroleum levy and urged the government to focus on controlling imports. Baloch also called for lower interest rates, saying high borrowing costs were slowing industrial activity and discouraging investment. He argued that rulers should reduce government expenditures and lessen dependence on loans.
While criticizing many aspects of the budget, Baloch welcomed the reduction in super tax and stressed the need for affordable medicines and healthcare.
Faisalabad exporters seek further reforms
In Faisalabad, Chamber of Commerce President Farooq Yousuf Sheikh described the budget as generally positive but urged the government to go further in supporting exports.
He noted that Pakistan faces interest payments of more than Rs8 trillion and called for stronger measures to boost exports rather than relying on remittances. He appreciated the continuation of markup support under the Export Facilitation Scheme but expressed disappointment that demands regarding rapid refund payments, capping reforms and reduction in levies had not been addressed.
Farooq said neighbouring countries were providing substantial support to their industries while Pakistani businesses continued to face regulatory hurdles from multiple government departments. He urged the government to introduce a genuine one-window operation for businesses and reduce unnecessary interaction with tax authorities.
Sialkot exporters disappointed over fixed tax regime
The Sialkot Chamber of Commerce and Industry termed the budget unsatisfactory and disappointing, saying the government's refusal to restore the fixed tax regime for exporters had ignored a joint demand from major chambers and FPCCI.
Chamber President Ehtesham Gilani said local shopkeepers had been given a fixed tax facility while exporters were being pushed back into frequent dealings with tax authorities. He argued that the decision would not improve revenue collection and could instead reduce government revenues.
Gilani said competitor countries such as India, Bangladesh and Vietnam were making business easier and reducing production costs, while Pakistani exporters continued to face rising costs and regulatory difficulties. He welcomed the abolition of super tax for exporters and supported proposals to reduce financing costs but warned that most small and medium exporters would not significantly benefit.
He also claimed that national exports had declined from $32 billion to $30 billion and complained that refunds worth Rs8 billion owed to Sialkot exporters remained unpaid despite government assurances.
Despite differing opinions on specific measures, business organisations across the country broadly agreed that the budget should have focused more aggressively on reducing the cost of doing business, supporting exports, encouraging industrial investment and expanding the tax base.
Most chambers welcomed relief for salaried individuals, the reduction in property-related taxes, support for the construction sector and the abolition of super tax in certain categories. However, they urged the government to address concerns related to exports, energy costs, taxation of industry, agriculture and SME development during parliamentary debate on the Finance Bill.