ISLAMABAD: The business community in a meeting at Islamabad Chamber of Commerce and Industry has expressed many reservations on the Federal Budget 2015-16 as it has not come up with any tangible measures to help entrepreneurs in reducing cost of doing business and become more competitive in the global market.
Chairing the meeting, Muzzamil Hussain Sabri, President, Islamabad Chamber of Commerce and Industry said that business community was strongly calling for appropriate cut in general sales tax to spur the growth of business and industrial activities. However, government has totally ignored their demand despite the fact that GST in Pakistan was almost highest in the region making our industry and exports uncompetitive.
He said ICCI had proposed to reduce tax rates that would help in broadening the tax base, however, instead of bringing down taxes, government has imposed many incremental taxes that will create more difficulties for business and industry in addition to putting more burden on the common man. He said that targets set in the budget seemed to be quite ambitious and would require serious efforts to realize.
He said that businessmen have been urging for zero-rated tax on export-oriented sectors, but instead of paying attention to their demand, government has further increased sales tax from 2 percent to 3 percent on the sales to un-registered buyers that would create liquidity problems for manufacturers and would make achieving exports targets more tougher.
However, he appreciated the incentives announced for agriculture, construction and power sector investors and hoped that these measures would help the economy perform better. He said Finance Minister has committed to clear all the outstanding sales tax refunds by 30th August 2015, which was laudable. However, he stressed that FBR should take serious measures to honor this commitment as the government had made similar commitment in budget 2014-15 to clear refund claims by Sep: 2014 while claims of Rs.110 billion were yet to be cleared.
Abdul Rauf Alam and Tariq Sadiq, former President ICCI said the reducing interest rate to 6 percent on PM’s youth loans, providing interest-free loans for solar tube-wells and increasing allocation for water resources were laudable steps that would prove beneficial for the economy.
They said that government has taken positive step by increasing federal PSDP budget to Rs.700 billion as it will accelerate pace of developmental projects. However, they said that during the financial year 2014-15, government made cuts in PSDP which caused delay in many developmental projects and advised that this practice should be avoided during FY 2015-16 to ensure the completion of developmental works on time in order to put the economy on the path of sustainable growth.
