OICCI Relief Plea: Salaried & Corporate Sector – Pakistan Business News
OICCI demands urgent tax relief for Pakistan’s salaried individuals and the corporate sector in the upcoming budget, citing an unfair tax structure. The Overseas Investors Chamber of Commerce and Industry (OICCI) advocates for doubling the taxable income threshold to ₨1.2 million and eliminating the 10% income tax surcharge on high earners. These proposals aim to broaden the tax base, encourage investment, and reshape tax policy. The current system disproportionately burdens compliant taxpayers, hindering economic growth, according to OICCI. Recommendations also include restoring tax credits and gradually reducing the corporate tax rate, addressing the low tax-to-GDP ratio. News Directory 3 covers this story. The government is considering these recommendations. Discover what’s next for pakistan’s tax landscape.
OICCI Calls for Tax Relief for Salaried Individuals, Corporate Sector
Updated June 07, 2025
The Overseas Investors Chamber of Commerce and Industry (OICCI) has appealed to the government to provide substantial tax relief to the corporate sector and salaried individuals in the upcoming budget. OICCI believes both are burdened by heavy direct and indirect taxes.
In a recent interview, OICCI Chief Executive M. Abdul Aleem described Pakistan’s tax structure as unjust and in dire need of reform to broaden the tax base. He stated that the current system disproportionately burdens compliant taxpayers, pushing talent to leave the country and hindering investment and economic growth.
The OICCI, representing over 200 multinational companies in Pakistan, has submitted recommendations to the government. Thes proposals aim to reshape tax policy, broaden the tax net, and promote fairness and investment.
A key suggestion is to double the taxable income threshold to ₨1.2 million, with a nominal ₨1,000 tax for those earning between ₨600,000 and ₨1.2 million. This aims to expand the tax base without overburdening low-income earners, while also mandating tax return filings.
The OICCI also advocates for eliminating the 10% income tax surcharge on individuals earning over ₨10 million annually, calling it a “tax on tax” that penalizes compliant taxpayers while leaving the undocumented economy untouched.they propose restoring tax credits for investments in mutual funds, IPOs, and life insurance, and also deductible allowances for housing loans, education, and medical expenses.
Pakistan’s tax-to-GDP ratio remains low, with a small percentage of citizens filing tax returns. The corporate sector and salaried workers bear much of the burden,while significant portions of the economy,such as real estate,retail,agriculture,and professionals,remain largely outside the tax net.
Other OICCI recommendations include gradually reducing the corporate tax rate from 28% to 25% over three years and abolishing the super tax to improve business competitiveness.They also call for automation, clarity, phasing out tax exemptions, implementing a track and trace system, and strict penalties on illicit trade.
Aleem noted the lack of progress in broadening the tax base and emphasized the IMF‘s concern about tax collection efforts if the government continues to resist expanding the tax net.
What’s next
The government is expected to consider these recommendations as it finalizes the budget, with potential implications for tax policy and economic growth.