The union of small and medium-sized enterprises (SMEs) has heavily criticized the newly announced financial budget for 2025-26, expressing serious concerns over several new fiscal policies expected to negatively impact the growth of SMEs across the country.

Zulfiqar Thaver, President of UNISAME, expressed deep disappointment following the government’s recent decisions, including the controversial decision to impose an 18% sales tax on solar panels. This move contradicts previous incentives that were aimed at encouraging SMEs to adopt sustainable energy solutions. Thaver has labeled the tax increase as a major obstacle to business energy independence and environmental sustainability.

Furthermore, the budget has also increased the income tax rate on bank deposits and savings income from 15% to 20%. This change is likely to discourage savings, increasing financial pressure on both individuals and businesses.

Additionally, the decision to eliminate tax exemptions for e-commerce companies, freelancers, and online startups has also faced severe criticism. Thaver called this decision “short-sighted,” particularly harmful to young entrepreneurs and self-employed individuals who are already struggling with unemployment and slow industrial growth.

Highlighting the gap between government promises and the harsh realities of the new budget, Thaver remarked, “The government had assured us that it was making reforms,” pointing out the discrepancy between current fiscal policies and expectations.

He reiterated the role of SMEs in the national economy, highlighting their contributions to employment, exports, GDP, poverty eradication, value addition, and supply chain formations. Thaver has appealed to Prime Minister Shehbaz Sharif, his special assistant Haroon Akhtar, the CEO of SMEDA, and the UNISAME Council for immediate attention and called for an urgent meeting to address the sector’s support and innovation needs promptly.