Reduction from 1.85% to 0.80–0.85% Termed Big Relief for Business, Boost to Trade and Export Competitiveness
KARACHI: President Karachi Chamber of Commerce & Industry (KCCI) Rehan Hanif, while highly appreciating the Sindh Government’s landmark decision to reduce the Infrastructure Development Cess (IDC), termed it a major relief for the business community and a positive step toward improving the cost of doing business in Karachi and across Sindh.Rehan Hanif, while elaborating on the broader implications of the Sindh Government’s decision, stated that the reduction in Infrastructure Development Cess (IDC) from 1.85% to approximately 0.80–0.85% represents a substantial rationalization of trade-related costs and aligns with internationally accepted principles of trade facilitation and fiscal prudence.He particularly acknowledged the pivotal role played by Chairman Businessmen Group (BMG) Zubair Motiwala, Vice Chairman BMG Jawed Bilwani, Former President KCCI Muhammad Idrees, and Chairman Pakistan Business Council Shabbir Dewan, who actively participated in a series of high-level meetings with the Sindh Government to resolve this pressing issue. Their consistent engagement, rigorous technical input, and unwavering representation of the business community’s concerns ultimately culminated in this constructive outcome. He noted that these sustained efforts formally commenced on April 22, 2025, when the first meeting of the relevant committee was convened, marking the beginning of a structured and focused consultative process that has now successfully reached its logical conclusion.President KCCI noted that the issue of IDC had long been a matter of serious concern for importers, exporters, industrialists, and traders, as it added to transactional costs and affected overall competitiveness. Through persistent dialogue, data-backed presentations, comprehensive global comparison of cess and principled advocacy, KCCI maintained that rationalization of IDC was essential to facilitate trade, curb inflationary pressures, and stimulate economic activity in the province.He further highlighted that the final decisive meeting on this subject was attended by Sindh Interior Minister Zia-ul-Hassan Lanjar, Excise Minister Mukesh Kumar Chawla, Secretary Excise Saleem Rajput, Mayor Karachi Murtaza Wahab, CM Secretary Agha Wasif, along with Chairman BMG Zubair Motiwala, Vice Chairman BMG Jawed Bilwani, Former President Muhammad Idrees and Chairman Pakistan Business Council Shabbir Dewan. He stated that the collective wisdom, seriousness of purpose, and commitment demonstrated by all participants were instrumental in translating the Chamber’s longstanding demand into a practical policy decision.He appreciated the introduction of a structured Settlement Agreement mechanism under the amended framework, describing it as a mature and forward-looking step that provides legal clarity, reduces administrative ambiguities, and creates a predictable pathway for resolving outstanding liabilities. President Rehan Hanif particularly welcomed the exemption of goods under the Export Facilitation Scheme (EFS) from the levy of IDC, terming it a strategic move that directly enhances export competitiveness. He noted that exporters operate in a highly competitive global environment where marginal cost differences determine market access, and this relief will improve pricing efficiency and support Pakistan’s export growth objectives.He further observed that the reduction in cess rates and the structured settlement framework would release much-needed liquidity into the market, improve working capital cycles for importers and industrial units, and reduce cascading cost pressures across supply chains. This, he emphasized, will not only benefit businesses but also contribute to price stability and broader economic activity in the province.He underscored that this achievement reinforces the effectiveness of constructive public-private engagement and reflects the Sindh Government’s willingness to support economic stabilization and growth. He expressed hope that this spirit of collaboration would continue, particularly in addressing other critical issues affecting industry and trade, including taxation rationalization, regulatory simplification, and infrastructure improvements.President KCCI also emphasized that certain issues pertaining to the Sindh Revenue Board (SRB) also require rationalization, particularly the high taxation rate on services that needs to be rationalized. He concluded by reaffirming KCCI’s commitment to safeguarding the legitimate interests of the business and industrial community and to working closely with the provincial government to ensure that Karachi, the country’s economic engine, remains competitive, resilient, and growth-oriented.
