Former caretaker federal minister Gohar Ejaz has put forward a comprehensive set of proposals calling for significant reductions in heavy taxes to stimulate economic growth in Pakistan. Speaking at an event organized by the Federation of Pakistan Chambers of Commerce and Industry in Lahore, Ejaz directly appealed to Finance Minister Muhammad Aurangzeb to reconsider the current tax structure affecting various sectors.
Ejaz highlighted the severe downturn in key industries, noting that half of the glass, cement, and tile manufacturing units have shut down due to lack of demand and high costs. He pointed out that Pakistan currently faces a shortage of 12 million housing units, despite having a housing industry valued at 500 billion dollars. He argued that if properly supported, the housing sector alone could contribute five percent to the country’s economic growth and create employment opportunities for 10 million people.
The former minister specifically demanded the removal of taxes on property buying and selling transactions. He believes that easing the tax burden on real estate would activate the construction industry, which in turn would revive dozens of linked industries and generate massive employment.
Discussing the broader fiscal situation, Ejaz stated that the Federal Board of Revenue is expected to collect 14 trillion rupees in taxes this year, which represents a tax-to-GDP ratio of twelve percent. He expressed confidence that Pakistan’s tax-to-GDP ratio could realistically reach eighteen percent if the right policies are implemented.
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Ejaz proposed a series of concrete reductions in tax rates across multiple categories. He recommended lowering the tax rate on individuals and associations of persons from 45 percent to 25 percent. For corporate taxes, he suggested a reduction from 60 percent to 25 percent. He also called for bringing down the general sales tax rate from 18 percent to 10 percent. Additionally, he proposed reducing the tax burden on the salaried class to just ten percent.
According to Ejaz, these tax cuts would not reduce overall revenue collection. Instead, they would expand the economy, increase compliance, and ultimately bring more businesses and individuals into the tax net. He argued that high taxes are currently pushing businesses into losses and forcing many to close operations entirely.
His proposals come at a time when businesses across the country are struggling with rising costs and declining demand. Industry leaders have repeatedly called for tax relief to help them survive and grow. Ejaz’s recommendations offer a roadmap for shifting from a high-tax, low-compliance model to a more sustainable system that encourages economic activity and job creation.
