Karachi – Junaid Naqi, President of the Korangi Association of Trade and Industry (KATI), praised the
International Monetary Fund’s (IMF) decision to reduce Pakistan’s tax target by Rs620 billion. Speaking
on the issue, Naqi stated that lowering the tax target from Rs12.97 trillion to Rs12.35 trillion reflects the
urgent need for economic stabilization, particularly in light of a Rs600 billion revenue shortfall over the
past eight months. He noted that this adjustment will ease undue pressure on industries while also
providing some relief to the business community.
Naqi further emphasized that maintaining the tax-to-GDP ratio at 10.6 percent is a positive sign, but he
urged the government to broaden the tax net and focus on pro-business policies to boost overall
economic activity. He also welcomed the forecasted drop in inflation from 12.5 percent to 7 percent,
cautioning, however, that the real benefits would materialize only if production costs fell and raw
material prices stabilized.
Naqi advised the government that efforts should be directed toward promoting industrial growth while
avoiding the introduction of new taxes or mini-budgets that could further burden the business sector.
He stressed that while sustaining the development budget is commendable, any spending cuts should
be implemented in a manner that does not adversely affect industrial output or exports.
Naqi concluded by expressing hope that ongoing negotiations with the IMF would safeguard Pakistan’s
economic interests, ultimately leading to decisions that pave the way for both stability and growth in the
industrial sector. He recommended that tax reforms be introduced to expand the tax net, ensuring that
sectors not yet covered are incorporated without placing additional strain on existing industries.
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