The business community of Karachi on Wednesday showed a mixed reaction over the federal budget.
The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) praised the “balanced” fiscal plan, but the Karachi Chamber of Commerce and Industry (KCCI) was critical of dealing with the taxation system.
The Overseas Investors Chamber of Commerce and Industry (OICCI) also found the new budget “below expectations”.
Also, the small traders expressed their disappointment over what All Karachi Tajir Ittehad (AKTI) President Atiq Mir called the “paper-made boat” that, he claimed, could not take Pakistan out of the deep crises.
Except the proposed 1 percent increase in 16 percent sales tax, all the budgetary measures the PML-N-led government proposed in the budget were welcomed by the traders and industrialists who had gathered at the Federation House to listen the two-hour long budget speech.
While some dubbed it “ambitious” others named the proposed budget for Financial Year 2013-2014 as “good governance budget”.
“On its face value it is a balanced budget,” commented FPCCI President Zubair Ahmed Malik.
Appreciative of the proposed “austerity drive”, Malik was unclear how the government would materialise certain budgetary pledges like arranging over Rs 5 billion to clear circular debts in 60 days, increasing country’s $11 billion reserves to $20 billion amid subdued exports.
The FPCCI chief, however, said the impact of 1 percent hike in GST would be inflationary in nature. Detailed view of the FY14 budget the FPCCI would give in a briefing due today (Thursday) at the Federation House.
Praising development side of the budget, KCCI President Haroon Agar said the FBR part was worrisome. He said the PML-N government on one hand abolished the “SRO culture” and on the other it issued two more SROs. If not addressed this anomaly, he apprehended, would lead to corrupt practices in the FBR.
“Seventy percent of development-related budget is great. But we hold strong reservations about the disappointing FBR part,” Agar told Pakistan Today.
Calling some budgetary proposals beyond comprehension, the KCCI president was unhappy with the government for making the traders and industrialists its withholding agents.
“It appears that the opportunity of tax reform has not been availed by the new team and instead the government has resorted to old tactics of taxing the already taxed at higher rates,” said OICCI Secretary General Abdul Aleem.
He said increase in sales tax and turnover tax would adversely impact the OICCI members. “We find this discouraging for future investments,” he added.
Overall, Aleem said, the budget should be improved if the government was serious in inviting large inflows of foreign direct investment into dollar-hungry Pakistan. “We would be willing to hold in-depth, periodical meeting with the government,” he said.
FPCCI Vice President Gulzar Feroz, however, lauded the austerity measures suggested, saying, “I would name it the good governance budget.”
Former FPCCI VP Khalid Tawab termed the budget speech as positive showing to the businessmen a clear line of action for next five years.
Pakistan Businessmen and Intellectuals Forum President Zahid Hussain said the budget manifested PML-N’s election manifesto that would excel economic growth in the country.
Ambitious was the word used by business leader Tariq Saeed while defining the budget in one word.
Urging the need for a budget that benefits all evenly, AKTI President Atiq Mir said the hike in GST would further cut the purchasing power of the buyers thus negatively impacting trade and business.
“An ideal budget benefits all. But this one was prepared without taking even the stakeholders aboard. This seems a paper-made boat that may not do any good to the cirses-hit Pakistan,” he said.
