KARACHI/LAHORE/ISLAMABAD – July 20, 2025
Traders Strike Shuts Down Karachi, Lahore Over Tax Measures
Pakistan’s commercial hubs grind to a halt as businesses protest Finance Act 2025-26.
Pakistan’s two largest commercial centers, Karachi and Lahore, experienced a near-total shutdown on Saturday as traders launched a strike against what they deemed harsh and anti-business taxation measures implemented through the Finance Act 2025-26.
- Nearly 90% of commercial activity ceased in Karachi, impacting wholesale markets, retail, and industry.
- Lahore also saw a widespread shutdown, with major markets closed in solidarity with the protest.
- Business leaders warned of further escalation if government inaction persists on tax reform demands.
- Islamabad and Rawalpindi reported normal business operations.
The strike, called by the Karachi and Lahore Chambers of Commerce and Industry, represents a significant display of unified protest by the business community. In Karachi, approximately 90 percent of commercial activities, including industrial zones and markets, ground to a halt. Jawed Bilwani, President of the Karachi Chamber of Commerce and Industry, stated this was an unprecedented voluntary shutdown in the chamber’s history. The economic impact is substantial, considering Karachi’s contribution of around 70 percent to federal tax revenues and 54 percent of national exports.
The demands from the business community are clear: immediate suspension of Sections 37A and 37B of the Sales Tax Act, which permit taxpayer arrest and prosecution without due process. They also seek the withdrawal of Section 21(s), penalizing cash transactions, and the reinstatement of the Final Tax Regime for exporters. These concerns were presented to a government committee, but only verbal assurances were received.
“Frustration has reached a boiling point,” Bilwani warned, indicating further nationwide consultations if written assurances or tangible progress are not made soon. He acknowledged the solidarity from various trade bodies and chambers across the country.
Lahore Joins Nationwide Protest
Lahore echoed Karachi’s shutdown, with traders protesting the new tax regime and expanded powers of the Federal Board of Revenue (FBR). Major markets, including Shah Alam Market, Hall Road, and Anarkali, remained closed in support of the Lahore Chamber of Commerce and Industry’s call for a strike.
Mian Abuzar Shad, President of the Lahore Chamber of Commerce and Industry, described the event as a historic demonstration of unity. “July 19 will go down as a defining day in the struggle for economic justice,” he stated. He emphasized that the unified closure of markets in Lahore and Karachi, representing over 60 percent of Pakistan’s economy, was a deliberate message to the government.
Discussions with government officials, including Special Assistant to the Prime Minister on Finance Haroon Akhtar Khan and FBR Chairman Rashid Langrial, reportedly yielded no written commitments. The LCCI is pushing for revisions to several tax provisions, including Sections 37A/B, e-invoicing, e-Bilty systems, a 16 percent sales tax on property rent, and a 20 percent tax on transactions exceeding Rs200,000.
Northern Cities Remain Open
In contrast, business activities in Islamabad and Rawalpindi proceeded as normal. Nasir Qureshi, President of the Islamabad Chamber of Commerce and Industry, indicated that the chamber is awaiting the outcomes of recent government assurances.
Meanwhile, Ajmal Baloch, President of the All Pakistan Anjuman Tajiran, announced plans for nationwide demonstrations starting July 26, with phased strike actions to follow if demands are unmet. He criticized the bureaucracy, alleging it misled the government, and warned of intensified protests if FBR’s new powers are not rescinded.
