A prominent business leader has warned that the government is facing growing fears of an upcoming mini-budget due to a significant shortfall of Rs 331 billion in tax collection during the first half of the fiscal year.
In a statement issued on Sunday, Shahid Rasheed Butt, former president of the Islamabad Chamber of Commerce, stressed that the fundamental challenges facing the economy are widespread tax evasion and smuggling, which require immediate and decisive action.
Mr. Butt pointed out that smuggling causes a loss of over one trillion rupees annually to the national exchequer. He pointed to factories of ghee, steel, and other items established in the former tribal areas by individuals from Punjab and Sindh, which are playing a significant role in this issue, and claimed they are breaking records in tax evasion and illegal trade.
The business leader described the undocumented economy as the biggest obstacle to economic recovery. He said that the smuggling of various items, including property, illegal cigarettes, tires, oil, medicines, and tea, causes heavy losses to the national exchequer.
He warned that if the current situation persists, the government will have no choice but to introduce a mini-budget, the financial burden of which will inevitably be passed on to the general public.
According to Mr. Butt, the solution lies not in imposing new taxes but in curbing tax evasion and bringing undocumented sectors into the legal framework. He concluded that achieving revenue targets is impossible without serious action against smuggling and a fundamental change in current policies.