Special Investment Facilitation Council (SIFC) National Coordinator Lieutenant General Sarfraz Ahmed has said that without abolishing the super tax and reducing the overall tax rate, it is impossible to attract new investment in the manufacturing sector. Speaking at the Pakistan Business Council’s seminar “Dialogue on the Economy,” he made it clear that the government is seriously reviewing the super tax, which was a temporary measure and now needs to be removed immediately.
He stated that the 29% corporate tax rate is also uncompetitive and should be reduced to 25%, while the inter-corporate tax must be completely abolished. According to him, the effective tax rate has reached nearly 50%, as after corporate tax, the super tax, worker welfare deductions, and dividend tax further impact the remaining income. This environment encourages businesses to break into smaller units, which harms the national economy.
Lieutenant General Sarfraz said that the finance minister and his team saved the country from default and stabilized the economy, but the real missing element is an integrated and sustainable growth plan. He pointed out that Pakistan has been following a consumption-led, debt-based growth model for decades, which is not sustainable. If this path continues, the outcomes will remain the same and crises will re-emerge. He stressed that export-led growth is the only solution, but for that, reducing tariffs alone is not enough—there must also be a level playing field in taxes, energy costs, ease of doing business, and the overall cost of doing business.
He expressed regret that a major portion of the money earned in Pakistan flows to Dubai, London, and other global cities instead of being reinvested in local infrastructure or compliance. According to him, Pakistan’s current foreign direct investment (FDI) stands at $1.2 to $1.3 billion, which should at least double or triple to $2.5 to $3 billion annually. He added that FDI which does not bring direct dollars into the country should be discouraged, except for long-term and essential infrastructure projects.
Lieutenant General Sarfraz Ahmed said that unless local investors step forward, foreign investment will not come either. He also emphasized the need to deregulate the energy sector, reduce interest rates, and ensure policy continuity. He said that with declining inflation, monetary policy must align with ground realities to accelerate the investment process.
