Pakistan Proposes 26% Corporate Tax, 72-Hr Refunds

Islamabad, August 8, 2025, 08:10 PM PKT — The Industrial Policy Committees, in a high-level meeting chaired by Special Assistant to the Prime Minister (SAPM) on Industries and Production Haroon Akhtar Khan, have unveiled bold reforms to attract investment and boost exports, proposing a gradual corporate tax cut from 29% to 26% over three years to match regional rivals like Vietnam (17%), alongside a 72-hour sales tax refund system, as discussed with government officials and stakeholders, per official reports. The super tax regime would rationalize to 5% on additional income over five years, potentially ending after six years if fiscal balance holds.

To enhance exports, the Drawback of Local Taxes and Levies (DLTL) scheme is proposed, with a dedicated monitoring system for timely refunds, plus the elimination of cross-subsidies in industrial power tariffs and advance taxes on exporters. Financial support includes simplified banking procedures and lower-interest export financing. SAPM Haroon Akhtar Khan reaffirmed the government’s export-led growth focus, tackling high interest rates and costly utilities, stressing sound policies and incentives for global competitiveness. Web context on export reforms shows past delays, while posts found on X reflect optimism and skepticism—some see growth potential, others doubt execution. Critically, the narrative of “export boost” may mask implementation risks—web data hints at policy gaps, and X sentiment suggests distrust in sustained results, pointing to challenges ahead.