The Overseas Investors Chamber of Commerce and Industry (OICCI) on Friday welcomed the Federal Budget 2026–27, noting it showed restraint, some structural ambition and meaningful forward movement in select areas.
“It is not a perfect budget which will magically bring FDI into the country, but in difficult times, it is not an unserious one,” read a statement issued by the representative body after Finance Minister Muhammad Aurangzeb presented the budget in the National Assembly.
Acknowledging the Federal Board of Revenue (FBR)’s collection of Rs. 13 trillion in the outgoing fiscal year, the chamber lamented that most of this was collected from those already in the tax net. “Organized businesses, formal sector companies and salaried taxpayers bore the brunt—visible, reachable and compliant—while the informal economy continued to expand unchecked,” it said, claiming the cash economy had grown from Rs. 9 trillion last year to Rs. 12 trillion this year, an increase of 33%.
“That is not a rounding error; it is a policy failure. Inaction on formalization carries a measurable cost, and this number makes it undeniable,” it said.
The OICCI welcomed the partial rationalization of the super tax, abolition for income slabs between Rs. 150 million and Rs. 500 million, and a reduction from 10% to 8% for income above Rs. 500 million. “It eases pressure on mid-sized formal enterprises and is consistent with the chamber’s longstanding advocacy,” it said, while regretting that core corporate income-tax rate remained unchanged. “OICCI looks to the Finance Bill for further clarity and urges a broader rate reduction in due course,” it said.
The organization dubbed the reduction in withholding and advance tax on export proceeds from 2% to 1.25% a “sensible” step, and also declared the rationalization of advance tax rates in the real estate sector as a constructive step to revive economic activity. “The I.T. sector and selected input categories also benefit from targeted relief. These are good measures, and OICCI commends them,” it said.
Referring to the government’s bid to reduce corruption in the FBR through a National Faceless Assessment Center and system-based assessment regime, the OICCI said it was among the more significant structural announcements in this budget. “It promises to reduce taxpayer-officer contact, curtail field discretion and lower harassment risk for compliant companies, concerns OICCI members have raised for years. The intent is right; delivery will be what counts,” it said.
However, the OICCI flagged two areas of “serious concern.” It noted there was no mention of restoring sales tax status or introducing zero-rating on oil refineries and marketing companies. “This is a huge burden on the OMCs, which is also holding back an expansion investment of $6-10 billion in the refinery sector,” it said. Additionally, it expressed deep concern that the budget had made no move to review the Minimum Tax on Turnover under Section 113 or the Alternate Minimum Tax under Section 153 of the Income Tax Ordinance, 2001. “These provisions have long distorted the tax burden by imposing tax on turnover rather profit, particularly in low-margin sectors,” it said.
“OICCI also notes the absence of any specific measures to accelerate corporate income-tax or sales-tax refund settlements. Pending refunds remain a material liquidity constraint on formal businesses. A clear, time-bound refund mechanism through the Finance Bill would send a strong signal of good faith to the investor community and the chamber urges the government to deliver one,” it concluded.