Government Weighs Tax Relief for Exporters in Upcoming Budget
The government is considering abolishing the one per cent advance tax on export proceeds in the upcoming federal budget, a move expected to provide relief of nearly Rs100 billion to exporters.
The proposal is being reviewed as part of limited support measures for the export sector, particularly the textile industry, which has been seeking broader reforms to improve competitiveness.
Exporters have long argued that the advance tax places pressure on liquidity by tying up working capital and increasing business costs. Industry representatives maintain that the sector continues to face challenges from high taxation, rising energy prices and delayed tax refunds.
Business groups have also called for reductions in electricity and gas tariffs, faster refund processing and revisions to the current taxation framework. They argue that Pakistan’s exporters face significantly higher tax and energy costs than regional competitors, affecting their ability to compete in international markets.
While the proposed tax relief is expected to ease some financial pressure, industry stakeholders say more comprehensive reforms will be needed to support export growth and strengthen economic activity.
