Shehbaz Sharif hints at reducing taxes for businesses

Prime Minister Shehbaz Sharif  – (Web Desk) – Prime Minister Shehbaz Sharif on Wednesday said the government is planning to lower direct taxes in the next federal budget, stressing that economic growth cannot continue if people and businesses are overburdened with taxes.

Speaking at the opening session of the Pakistan Governance Forum 2026 in Islamabad, the prime minister questioned how long the country could rely on increasing taxes without improving production, exports, and investment. He said real progress depends on expanding industries, boosting exports, and attracting foreign investment rather than imposing more taxes.

He explained that the main purpose of reducing direct taxes is to support businesses and restore investor confidence. According to him, investors and entrepreneurs must feel secure that their investments will grow instead of being reduced by heavy taxation.

The prime minister also emphasized expanding the tax base, noting that Pakistan’s tax-to-GDP ratio has reached 10.5 percent due to recent efforts. He added that the government is also focusing on reducing indirect taxes, which often place a heavy burden on ordinary consumers.

He expressed concern that some indirect taxes collected from the public are not properly deposited into government accounts, calling it unfair to the nation.

Recalling the economic crisis of June 2023, Shehbaz Sharif said Pakistan was close to default but was stabilized through joint efforts of federal and provincial governments and national institutions. He highlighted that inflation, which was around 35 percent, has now dropped below 7 percent, and the policy rate has been reduced to 10.5 percent.

He concluded by stressing that Pakistan has strong potential to increase exports and must continue working towards sustainable economic growth through investment, production, and collective national efforts.

The prime minister said that certain reforms introduced by the government were home grown and the IMF had no role in it as it was their requirement and need of the time to avert the boom and bust cycle.

He further said in the power sector, the price of power per unit had been slashed by Rs9 while the solar investment was protected and commended the minister for power and his team for making efforts in this regard.

The prime minister regretted that the country was enduring Rs200 billion power theft and only the whole of the government approach could tackle this issue.

He also highlighted the necessity of closure of Utility Stores, which according to him, was “a den of corruption and theft”.

The prime minister also cited the Pakistan Works Department (PWD) and said it was a department tainted with corruption, and the closure of these entities saved billions of the nation.

With PM’s Ramazan Package, an amount of Rs38 billion was being distributed to the deserving people through digital wallets in a dignified and transparent manner, he added.

The ceremony was attended by chief ministers, ministers, provincial ministers, experts, diplomats, investors, businessmen, traders and officials.

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Emphasising the need for collective efforts in the economic sector, the prime minister said: “Though the journey can be a long, arduous and thorny one, but we have accepted the challenge. Pakistan will carve its due place soon.”

The prime minister further reiterated that it was not the job of the government to do businesses rather it had to facilitate the private sectors, exporters and investors and support their efforts in the productivity and growth.

The government was encouraging the exporters, investors and businessmen with diverse incentives, he added.