KARACHI: While showing some reservations towards the federal budget presented by Federal Finance Minister Ishaq Dar, the Federation of Pakistan Chambers and Commerce and Industry (FPCCI) says just 20 percent of their budget proposals were accepted by the federal government.
“The budget has both the positive as well as negatives aspects which need to be rationalise to increase tax-base and generate revenue,” said FPCCI Chairman Mian Muhammad Idress during a press conference at the Federation House.
Mian Idrees said the FPCCI presented at least 69 tax proposals, out of those 12 had been fully accepted and 10 partially accepted, adding that the remaining 47 proposals belong to either broadening of tax base or ease to doing business remained unattended.
“The government, for those proposals, has constituted two committees with chairman FPCCI as chairman of Broadening of Tax Base while Chairman Federal Board of Revenue and Secretary Finance and other relevant persons will be the members of the committee”, he informed.
“The budget sets growth target at 5.5 percent for fiscal year 15-16 whereas industrial growth is projected at 6.4 percent. However, it is surprising that the last year GDP growth rate was projected at 5.1 percent which was achieved at 4.1 percent while industrial growth rate was projected at 6.9 percent while achieved at 3.2 percent”, he added.
The FPCCI chairman said that the most drastic indicator was growth in Large Scale Manufacturing which was set at 7 percent however achieved at 2.3 percent. There is no water available for the large manufacturers in Karachi and no gas in Punjab that has made much difficult for the manufacturers to give their deliveries timely, he said and added that there was no policy for the small manufacturers in the budget.
“The sales tax on (withholding) on exports was increased by 1 percent which may adversely affect textile exports and the business community had demanded the government to bring it on zero percent. Besides, it is positive point that first time in the history of Pakistan, the finance minister has affirmed the payment of refund which was a serious issue. Now a definite period has been announced for payment of refunds and it would resolve the working capital problem of the industry”, he says.
It was a demand by the exporters to Afghanistan (which was firmly supported by FPCCI) that exports to Afghanistan should be allowed in Pakistani rupees. Afghanistan is included in the third leading export destination of Pakistan and it may become a source to internationalise Pakistani currency, the FPCCI chairman added.
Mian Muhammad Idress also lauded steps to boost the real estate, construction industry, export of rice, halal meat and fish. “We have to strengthen the economy. We do not want our money fly to other countries. The government should remove 1 percent WHT on export of rice and 3.5 percent tax on its local supply”, he demanded.
