Exporters said policy, taxation and incentives should be handled exclusively at the federal level with uniform rules across provinces to avoid overlapping regulations and disruptions in trade. They added that centralisation is necessary to ensure compliance with international agreements signed by the federal government. The sector, which accounts for 56% of Pakistan’s exports, warned that rising costs and liquidity constraints have reduced profit margins to 2-3%, raising concerns about sustainability.

Exporters called for an immediate return to the Fixed Tax Regime, replacing the current Normal Tax Regime under which corporate tax stands at 29% and other entities face rates of up to 45% along with additional levies. They said the shift to the current system has created liquidity pressures, including upfront tax deductions on export proceeds and delays in refund payments, with billions of rupees reportedly pending. The associations also proposed restoring the Export Facilitation Scheme to its earlier structure, reintroducing the Duty Drawback of Taxes and Levies scheme with incentives linked to export growth, and withdrawing super tax from the export sector.

To improve competitiveness, exporters recommended reinstating regionally competitive energy tariffs, freezing utility rates, reducing interest rates and simplifying social security contributions. The government was urged to prioritise these measures to support industrial activity, employment and foreign exchange earnings. The minister acknowledged the proposals and said consultations with stakeholders were ongoing across the country as part of preparations for the upcoming budget.