Prime Minister Shehbaz-Sharif-led government has unveiled plans to reduce the corporate tax burden to stimulate industrial growth.

In the upcoming budget, industries will receive relief, aiming to increase their share of GDP and expand exports.

The Ministry of Industries and Production has finalized preparations for the new industrial policy, which targets raising the sector’s contribution to GDP from 18 percent to 26 percent. Exports from industries are expected to rise by 6 percent under the initiative.

Special Assistant to the Prime Minister Haroon Akhtar Khan, confirmed that the government will approach the IMF to seek tax exemptions for industries, arguing that current taxation levels hinder industrial development.

Haroon Akhtar Khan revealed that five major companies are ready to invest in reviving Pakistan Steel Mills, with plans to restore operations fully within four years. Talks are also in advanced stages with two Russian firms to support the revival project, signaling a major step toward industrial self-sufficiency.

Deregulation and new policies

The sugar sector is slated for deregulation by June 2026, aiming to improve efficiency and competitiveness. Meanwhile, the government is also working on policies to promote local manufacturing of mobile phones, tractors, and solar batteries.

Additionally, a new policy for grid storage technology is underway, reflecting a push toward modernizing Pakistan’s energy and industrial infrastructure.

The government plans to negotiate with the IMF to reduce corporate taxes while promising an expanded tax net through other avenues. “We will tell the IMF that industrial relief will ultimately increase revenue while enabling sector growth,” said Haroon Akhtar Khan.