Latest news with #Section37AA
Business Recorder
02-08-2025
- Business
- Business Recorder
FPCCI underscores need for reducing interest rate
KARACHI: The Acting President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Zaki Aijaz said that keeping the interest rate at 11% and not reducing electricity prices has worsened the economic situation. He urged the government to bring the interest rate into single digits without waiting for the new monetary policy, in order to revive the economy. Addressing press conference, he declared the country's economy to be 'dead'. He stated that due to the government's measures, the economy is unable to revive and is currently in a dead state. He further stated that after successful negotiations between the government and the business community official notifications are expected to start being issued by Monday. Zaki Aijaz claimed that the government has accepted their demands regarding Section 37AA, the two-lakh cash deposit limit, and digital invoicing. He said that Section 37AA was a major demand of the business community, and FBR has already issued a notification on it. As per the notification, a five-member committee has been formed. Regarding cash deposits over PKR 200,000, he explained that there will be no tax on such transactions if they are made through sales tax registered accounts and are properly invoiced. He also informed that the government has given time from September to December 2025 for the implementation of digital invoicing. Zaki Aijaz further revealed that the Karachi Chamber of Commerce had assured the government during negotiations that there would be no strike, but despite issuing a press release to that effect, they later called for a strike independently. Copyright Business Recorder, 2025
Business Recorder
15-07-2025
- Business
- Business Recorder
Traders vow their unwavering support to LCCI
LAHORE: The Lahore Chamber of Commerce and Industry witnessed a massive show of strength at its Traders Convention, where thousands of traders declared their unwavering support for the LCCI. Following overwhelming input from the trader community, LCCI President Mian Abuzar Shad conditionally accepted the government's offer for negotiations saying that any talks must be meaningful and solution-oriented. He said that the July 19 nationwide strike will proceed as scheduled. LCCI President Mian Abuzar Shad, Senior Vice President Engineer Khalid Usman, Vice President Shahid Nazir Chaudhry, Former LCCI Presidents Mian Anjum Nisar, Muhammad Ali Mian, former Senior Vice President Ali Hussam Asghar, former Vice President Faheem ur Rehman Saigol, representatives of trade and industrial associations and LCCI Executive Committee Members spoke on the occasion. President LCCI Mian Abuzar Shad said that the business community has been pushed to the wall through oppressive policies. We don't enjoy going on strike. We have been squeezed to the point of compulsion. He said that when Lahore moves, the entire country follows. He condemned the imposition of Section 37AA of the Income Tax Ordinance and called it a draconian law aimed at destroying trade and industry. Dual nationals are drafting policies for this country. No wonder the economy has reached this crisis point. He said that the business community did not take these massive loans we are not liable to bear their burden. Why are the $200 billion held abroad not brought back? he questioned. Mian Abuzar warned that if even a single trader is harmed, the entire national business community will rise in protest. We will pay our taxes and we will also demand accountability for the corruption eating up our economy. Former LCCI President and SAARC Chamber Vice President Mian Anjum Nisar said that we do not want to strike but the government has left us with no choice. Doing business has become nearly impossible due to the harsh and impractical budget measures imposed by FBR. He revealed that in Lahore, FBR officials pulled guns on each other over bribery money disputes. He said that the politicians set Rs500 million corruption limit for NAB but businesspersons are arrested over suspicion of Rs50 million. Why this double standard? He warned that Section 37AA would further promote corruption and destroy economic confidence. 'There's only 5% tax in the UAE,' he added and said that here we face one-sided oppression. This won't be just a Lahore strike, Karachi, Peshawar, Sialkot and the entire nation will join. LCCI Senior Vice President Engr. Khalid Usman said that the Finance Minister had promised to incorporate the business community's suggestions into the budget but not a single proposal was implemented. He confirmed that LCCI has been in daily contact with chambers across Pakistan. This will begin with a one-day strike but if the issues remain unresolved, we will launch an indefinite nationwide protest. He said that we are open to negotiations but not for lip service, only for actual solutions. The July 19 strike will go ahead as a countrywide movement. LCCI is leading this historic effort. For the first time in Pakistan's history, there will be a nationwide shutter-down and wheel-jam strike. Copyright Business Recorder, 2025
Business Recorder
28-06-2025
- Business
- Business Recorder
LCCI rejects 37AA, describes it as ‘black law'
LAHORE: The Lahore Chamber of Commerce and Industry, trade and industrial associations, at a press conference at LCCI, have rejected 37AA and called it a 'black law' that would severely damage the business climate in Pakistan. LCCI President Mian Abuzar Shad, Vice President Shahid Nazir Chaudhry, former Presidents Mian Anjum Nisar, Muhammad Ali Mian, representatives of various trade and industrial associations spoke on the occasion. LCCI President Mian Abuzar Shad said that Clause 37AA empowers tax authorities to arrest any taxpayer merely on suspicion of tax fraud, even without concrete evidence. This clause is nothing less than a sword hanging over the heads of the entire business community. He said that prior to this clause the definition of tax fraud had already been broadened extensively, encompassing a wide range of actions, from minor accounting mistakes to misinterpretation of law. The new clause now grants excessive and unchecked powers to FBR officers, enabling harassment and potential abuse. The LCCI President said that business community has unanimously rejected this clause and are calling for its complete withdrawal. Such sweeping powers not only violate basic principles of justice but also infringe upon the constitutional rights of taxpayers. It will scare off investors and damage the trust that businesses have in the system. Mian Abuzar Shad said that reputations of the businesses are at stake and arresting company officers, especially on mere suspicion, would bring serious disrepute and operational disruptions to large enterprises. He said that following country-wide backlash, the government made a minor amendment to Section 37AA saying that arrest can only occur if there is a tax loss exceeding Rs50 million and upon the approval of a three-member committee. However, LCCI firmly rejected this amendment as well. 'Even with the amendment, the law remains draconian. The fact that arrest powers can be exercised without concrete evidence or judicial oversight is unacceptable,' Mian Abuzar Shad added. LCCI Vice President Shahid Nazir Chaudhry said we have always advocated for business-friendly policies. But laws like Section 37AA will only create new challenges for an already struggling economy. Entrepreneurs will be discouraged and investment will decline further. Former Presidents Mian Anjum Nisar and Muhammad Ali Mian urged the government to immediately withdraw Clause 37AA saying that unless business leaders are given breathing space, Pakistan will not be able to achieve the ambitious economic goals outlined in the budget. They said that the government has set a GDP growth target of 4.2% and an export target of $35.3 billion but laws like these will make such goals impossible to achieve,' they warned. All the representatives of trade and industrial associations unanimously and forcefully reject Section 37AA. The participants of the Press Conference said that we are not criminals. We are the backbone of the economy. This clause must be rolled back immediately so that we can focus on reviving Pakistan's economy instead of defending ourselves against unjust and arbitrary harassment.' They said that the LCCI's powerful stand reflects growing unrest in Pakistan's business circles over heavy-handed and impractical taxation policies. If the government truly wants economic revival, it must abandon such oppressive clauses and create a trust-based tax environment. Copyright Business Recorder, 2025
Express Tribune
27-06-2025
- Business
- Express Tribune
KCCI slams FBR proposals
Listen to article President of the Karachi Chamber of Commerce and Industry (KCCI), Muhammad Jawed Bilwani, has strongly criticised the Federal Board of Revenue (FBR) for what he termed its authoritarian conduct and disregard for the Business Anomalies Committee, comprising presidents of chambers and trade bodies from across Pakistan. Following extensive consultations with its members, KCCI has launched a citywide protest by displaying banners across Karachi against what it calls "oppressive" provisions in the Finance Bill 2025-26, particularly the proposed Section 37AA in the Sales Tax Act. "This is just the beginning," Bilwani said in a statement. "The protest will escalate, with press conferences by KCCI and other major chambers. If our demands are ignored, we may have no choice but to call for citywide or even nationwide strikes." He dismissed the finance minister's claims of a "public-friendly" and "business-friendly" budget as detached from reality. "Industrialists and exporters unanimously agree — there is no relief." Bilwani outlined a grim outlook for the business environment, citing high energy costs, poor infrastructure, gas shortages, water scarcity, and delayed tax refunds. "Our exports survive not because of policy support, but due to the resilience of our business community. Some buyers are even advising us to shift operations to more stable, business-friendly countries." Criticising Section 37AA as a "draconian law," he said it allows FBR to freeze bank accounts, seize funds, and arrest taxpayers based solely on suspicion, regardless of their past compliance. "Who will continue to do business under such hostile conditions?" He revealed that many businessmen have asked KCCI to help them explore options for relocating abroad. "We still want to stay and contribute. But we need the government and prime minister to listen and give us confidence." Bilwani stressed that this frustration is nationwide. "Faisalabad, Lahore, Sialkot — all major export hubs — are raising the same concerns."
Business Recorder
18-06-2025
- Business
- Business Recorder
FPCCI rejects law allowing businessmen's arrest
LAHORE: The Federation of Pakistan Chambers of Commerce & Industry (FPCCI) has vehemently opposed the recently enacted law permitting the arrest of business community members, terming it entirely unacceptable. FPCCI President Atif Ikram Sheikh, alongside Patron-in-Chief of the United Business Group (UBG) S.M. Tanveer, FPCCI Vice Presidents Zaki Aijaz and Tariq Jadoon, and other prominent business leaders, expressed their strong reservations during a press conference held at the FPCCI Regional Office in Lahore. The business leaders announced their decision to halt all industrial operations and symbolically hand over factory keys to the government, challenging it to manage the industries itself. Criticizing the introduction of Section 37AA, they declared that if the government intended to arrest businessmen, they could no longer continue running their factories. While reaffirming their willingness to cooperate with the government, they emphasized that the business community has always supported national revenue objectives but would not tolerate any form of harassment. The leaders reiterated their longstanding demand to reduce electricity tariffs to 9 cents per unit, pointing out that despite a decline in the Consumer Price Index (CPI), interest rates remain unjustifiably high. They also condemned the imposition of an 18% sales tax on solar energy solutions, labelling it an unreasonable measure. Additionally, they called for the immediate reinstatement of the Final Tax Regime (FTR) and the complete restoration of the Export Facilitation Scheme (EFS) in its original form. FPCCI President Atif Ikram Sheikh stated, 'We are fighting for the rights of the business community. Until all policy anomalies are resolved, we stand in full solidarity with all trade bodies.' He further revealed that a meeting with the Prime Minister of Pakistan would soon be arranged to seek resolution on these critical issues. The business community has given the government a seven-day ultimatum to address their concerns. To formalize negotiations, an eight-member committee has been formed under the leadership of FPCCI President Atif Ikram Sheikh. The committee includes FPCCI Vice President Zaki Aijaz, former FPCCI President Zubair Tufail, Chairman of the FPCCI Policy Advisory Board Mian Zahid Hussain, Sialkot Chamber President Ikram-ul-Haq, former Faisalabad Chamber President Dr. Khurram Tariq, FPCCI Executive Committee Member Momin Ali Malik, and Khyber Pakhtunkhwa representative Fahad Ishaq. The committee will engage with the government to seek immediate redressal of the business community's grievances. The FPCCI's strong stance underscores the growing frustration within Pakistan's business sector over policies perceived as detrimental to industrial growth and economic stability. The coming days will be crucial in determining whether the government and business leaders can reach a consensus to avert further disruptions. Meanwhile, the FPCCI's Businessmen Panel (BMP) has said that the entire business community of Pakistan, including all major chambers of commerce and industry as well as trade associations across the country, has unanimously rejected the recently introduced Section 37AA of the Sales Tax Act, terming it a draconian and unconstitutional law that grants sweeping arrest powers to the Federal Board of Revenue (FBR). BMP Chairman and FPCCI former president Mian Anjum Nisar said that businessmen strongly condemned the provision, warning that such an oppressive step has not been witnessed even during the colonial British era. Addressing a trade delegation of trade and industrial representatives here, he said that representatives from the Lahore Chamber of Commerce and Industry, Karachi Chamber, Islamabad Chamber, Rawalpindi Chamber, Faisalabad Chamber, Sialkot, Quetta, and Peshawar Chambers, along with numerous sectoral trade and industrial bodies, have called for the immediate withdrawal of Section 37AA. The entire private sector stands united in opposition, declaring that the FBR's move to criminalize business activities on mere suspicion of tax evasion is unacceptable and will not be tolerated. He said that the Businessmen Panel (BMP), representing the country's largest and most credible platform of industrialists, exporters, and traders, has pledged to stand firm with all chambers and trade bodies in this cause. The BMP has warned that this issue will not fade away until the unjust law is removed and meaningful engagement begins. The government must decide whether it wants to build the economy with the private sector—or break it under the weight of fear and authoritarianism. Anjum Nisar said that the business community fears that this new law, which gives tax officers' unchecked authority to arrest any businessman without court permission, based solely on suspicion, will cause irreparable harm to Pakistan's fragile economy while FBR has no good record in this regard. He argued that such laws destroy investor confidence, discourage industrial activity, and trigger capital flight at a time when the country is already facing serious economic challenges. He stressed that laws like Section 37AA violate the Constitution of Pakistan, particularly Article 10A, which ensures the right to a fair trial and due process. He said businessmen from across Pakistan have questioned how arrests without proof or trial can be justified in a democratic society. The mere allegation of underreporting or a suspected tax shortfall should not be sufficient grounds for arresting businessman. Legal experts and constitutional scholars have echoed these concerns, pointing out that FBR officers are being handed police-like powers without any judicial oversight or accountability mechanisms, opening the door to potential abuse, corruption, and harassment. The business community has demanded that tax collection and compliance remain a civil matter, not a criminal one. Turning tax disputes into criminal offenses sends a negative message to local and foreign investors, who are already hesitant to operate in Pakistan due to inconsistent policies and high costs of doing business. Entrepreneurs warn that such a hostile regulatory environment will drive many businesses into the undocumented economy, reduce tax collection instead of increasing it, and severely damage export potential and job creation. Trade and industry bodies have also noted that this law will lead to a culture of fear and uncertainty in the market. Businesses are already struggling with rising electricity and gas tariffs, volatile exchange rates, excessive taxation, and declining demand. Adding the threat of arrest by tax authorities will only push more people out of formal business activity and erode trust between the government and the private sector. He warned that FBR's earlier coercive actions, such as freezing accounts and sealing premises, were counterproductive. Now, granting arrest powers without trial has crossed all limits. He condemned the law as a dangerous attempt to control the business community through intimidation rather than policy reform. He also voiced strong objections, declaring it an anti-business and unconstitutional measure that would never be accepted. Anjum Nisar demanded that the government take immediate notice of this matter and revoke Section 37AA. Instead of threatening legitimate taxpayers, the FBR should focus on broadening the tax base, simplifying tax procedures, and encouraging voluntary compliance through dialogue and reforms. Arrests and coercive measures have never delivered results in the past and will not work now. Sustainable tax collection can only be achieved through trust, transparency, and facilitation—not fear and force. If this law is not withdrawn, the private sector has warned that it may resort to nationwide protests, shutter-down strikes, and legal action. The business community will not accept any law that treats entrepreneurs and job creators like criminals. The collective voice of Pakistan's chambers and trade associations must not be ignored. Their message is clear: arrest powers have no place in tax enforcement, and the law must be repealed to restore sanity and balance in economic policymaking. The business community wants reform, not repression. They stand ready to cooperate with the government in tax compliance but will resist any attempt to criminalize entrepreneurship. Copyright Business Recorder, 2025
