By Ata Ur Rahmen 
Balanced Taxation Framework in Pakistan: Gohar Ejaz Calls for Fair Fiscal Reforms
Business magnate and former trade minister Dr Gohar Ejaz has called for a Balanced Taxation Framework in Pakistan, stressing that the country’s growing tax revenues must be matched with fairness and sustainability.
Dr Ejaz noted that while Pakistan’s tax collection has reached historic highs, the excessive financial pressure on both salaried professionals and the business sector threatens long-term economic stability.
He emphasized that fiscal growth cannot be achieved by overburdening compliant taxpayers and urged policymakers to build a taxation model that supports productivity, compliance, and equality.
Record Rs5.83 Trillion Income Tax Collection Raises Concerns
Dr Gohar Ejaz pointed out that Income Tax collection in Pakistan for fiscal year 2024–25 has surged to a record Rs5.83 trillion, compared to Rs4.57 trillion in FY 2023–24. While this marks a significant achievement in government revenue generation, it has also triggered widespread discontent among citizens and business owners.
He revealed that Rs575 billion of the total came from salaried individuals, a sharp rise from Rs364 billion in the previous year. “The increase is not just numerical; it represents the growing financial burden on working individuals,” Dr Ejaz stated, adding that inflation and stagnant wages have already strained household budgets.
Business Community Pays Majority of Taxes
Highlighting the corporate sector’s contribution, Dr Gohar Ejaz shared that the business community, which includes corporates, private limited firms, foreign and banking companies, and Associations of Persons (AOPs), collectively contributed Rs5.3 trillion in income tax this fiscal year — up from Rs4.1 trillion last year.
He detailed the contributions:
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Private Limited Companies: Rs1.36 trillion
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Listed Companies: Rs866 billion
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Banking Companies: Rs930 billion
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AOPs: Rs214 billion
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Other Individuals: Rs1.12 trillion
According to Dr Ejaz, these figures reflect an “imbalanced fiscal system” where both salaried professionals and formal businesses bear the majority of the tax load while large portions of the economy remain untaxed.
Need for a Balanced Taxation Framework in Pakistan
Calling for structural reforms, Dr Gohar Ejaz reiterated that the government must design a Balanced Taxation Framework in Pakistan that aligns fairness with fiscal responsibility. He argued that sustainable economic growth requires broadening the tax base rather than intensifying existing burdens.
He said the government’s current approach—focused on high-income earners and registered businesses—risks discouraging compliance and investment. “We need a taxation system that encourages formalization instead of punishing those already in the tax net,” Dr Ejaz emphasized.
He added that the projected Tax-to-GDP ratio for FY 2025–26, which includes direct taxes, indirect taxes, petroleum levies, and provincial taxes, is expected to exceed 15% of GDP, signaling a need for structural balance and equity.
Balancing Tax Growth and Economic Stability
Economic experts echo Dr Ejaz’s concerns, suggesting that a balanced taxation framework in Pakistan must focus on three priorities:
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Reducing over-reliance on indirect taxes that disproportionately impact low-income households.
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Expanding the tax base by including sectors such as agriculture, real estate, and the informal economy.
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Improving compliance through digitalization, simplified filing systems, and transparent audits.
Dr Ejaz stressed that these reforms are essential to restore public confidence in the taxation system. “Pakistan’s fiscal health depends not only on how much revenue we collect, but also on how fairly it is collected,” he said.
The Way Forward: Equitable Economic Policy
The call for a balanced taxation framework in Pakistan is not just about revenue—it’s about ensuring economic justice and sustainable development. As Pakistan navigates inflation, currency pressure, and energy shortages, fiscal policy must evolve to support the productive class rather than penalize it.
Dr Gohar Ejaz expressed optimism that with strategic reforms, Pakistan can revive its economic momentum. “A fair taxation model will drive investment, innovation, and inclusive growth,” he stated, emphasizing that economic resilience depends on empowering businesses and individuals alike.
Building a Fairer Tax Future
In conclusion, Dr Gohar Ejaz’s call for a Balanced Taxation Framework in Pakistan underscores the urgent need for fiscal reforms that promote fairness, equity, and shared growth. The government’s record tax collection reflects progress in compliance but also exposes the imbalance in the current system.
To sustain growth, policymakers must design a model that distributes the tax burden equitably across all segments of society, fosters trust in institutions, and strengthens Pakistan’s path toward economic stability and inclusive prosperity.
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