FPCCI slams 18pc tax on e-commerce transactions, solar panels

KARACHI: Vice President of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Muhammad Amaan Paracha has said that the federal budget for the new fiscal year does not align with the expectations of the trade, industry, and the general public.

He criticised the imposition of taxes on e-commerce transactions, saying it is an unjust move. “Unemployed youth were earning through e-commerce, and this step will stifle their potential,” he said.

Expressing serious concern over the 18% tax imposed on solar panels, Paracha said the government has retrieved Rs 3 trillion through the termination of Independent Power Producer (IPP) agreements — a positive move for the power sector. However, instead of formulating an effective alternative energy policy, the government has imposed 18% sales tax on solar panels. This has already caused a spike in solar panel prices in the market.

“The entire business community unanimously demands the immediate withdrawal of this sales tax,” he added.

“We had hoped for relief to help the industry stabilize, but even the agricultural sector received no support, and the government turned a blind eye to education, offering no relief,” Paracha stated.

He further pointed out that the federal budget for 2025–26 contains over 40% anomalies that the government must address.

The industrial sector had expected the budget to be business-friendly and in the public interest, but instead, it has led to deep disappointment.

Due to rising electricity prices, industrial production costs are already extremely high, and taxing solar panels will deprive industries of cheap energy options — effectively forcing them to buy expensive electricity, which is unfair.

Paracha acknowledged that given the current post-Pakistan-India war scenario, an increase in the defense budget was inevitable.

He cited the regional situation, recent surge in terrorism, India’s water aggression, and non-traditional threats as reasons to prioritize national security. A 21% increase in the defense budget, allocating Rs 2,550 billion, was a necessary and vital step, he said.

He also urged the SBP governor to reduce the interest rate by 3% in the monetary policy scheduled to be announced on Monday.

Copyright Business Recorder, 2025