Cut in corporate tax to stimulate growth, EPBD urges govt

ISLAMABAD: Economic Policy and Business Development Chairman Dr Gohar Ejaz has called for a sharp reduction in Pakistan’s corporate tax rates, warning that excessive taxation is stifling growth, discouraging investment and undermining competitiveness.

‘Pakistan currently bears one of the highest corporate tax burdens in the region — comprising a 29 percent corporate tax rate, a 10 percent super tax, a 2 percent Workers Welfare Fund, and a 5 percent Workers Participation Fund”, said Ejaz in a statement on X (formerly Twitter) titled “Cut Taxes, Not Growth!.”

He further pointed out that dividends are taxed at 15 percent, leading to double taxation, while multiple levies such as advance withholding, sales tax, and excise duties further add to the burden on businesses.

“Pakistan now ranks among the lowest in terms of state competitiveness globally. We have taken the wrong path to increasing tax revenue by pushing tax rates above 50 percent, which has effectively choked the entire economy,” he cautioned.

Dr. Ejaz urged the government to reduce the maximum tax rate to 20 percent, arguing that sustainable growth, industrialization, investment inflows, and long-term revenue generation could only be achieved through a lower and more business-friendly tax regime.

Copyright Business Recorder, 2025