Business leaders of the country at a post-budget conference organised by the Islamabad Chamber of Commerce & Industry (ICCI) at a local hotel called upon the government to revise increase in taxes proposed in federal budget 2014-15 to save the businesses from closure and the national economy from further slowdown.
Presidents of chambers of commerce and industry from across Pakistan including Karachi, Lahore, Faisalabad, Sialkot, Rawalpindi, Peshawar and Quetta attended the conference. In his welcome address, Shaban Khalid, President Islamabad Chamber of Commerce and Industry, said the purpose to this get together was to discuss the key features of Budget 2014-15 and give an opportunity to the representatives of business community from across the country to develop consensus and send a unanimous message to the government for further improvements in the Finance Bill 2014-15.
The business leaders were of the view that government had increased many taxes in the budget, which would add problems for the entrepreneurs and cause more inflation in the country. They said the government should facilitate the growth of businesses which will automatically generate more tax revenue, create more jobs and increase exports of the country.
They said measures like alternate corporate tax, increasing withholding tax rates, enhancing gas infrastructure development cess on natural gas consumption up to Rs 300/MMBTU and giving more powers to FBR officers under Sec-40B will badly affect trade and industry as they will enhance the cost of doing business, promote informal sector and push SMEs towards closure due to which the overall impact on these budget measures would be negative on the business environment and called upon the government to revise these measures.
Speaking at the occasion, Dr Waqar Ahmed, Executive Director, Sustainable Development Policy Institute, said the new budget had increased consumption taxes, which will put more pressure on consumers. He said instead of improving the economy, new budget had been made just to appease the IMF due to which budget was not expected to bring the economy out of troubled waters. He was critical of the frequent cuts in PSDP allocations.
He said the government had not set right priorities in the budget as the allocations for energy sector had a gestation period of eight years while the country needed energy solution on urgent basis to enable businesses to grow and flourish.
Renowned economist Sakib Sherani said new budget would put more pressure on common man and create lot of problems for private sector. He said 85 percent of the total expenditure was spent on debt servicing and the government should focus on mobilization of indigenous resources and get rid of heavy borrowings. He said FBR is resorting to predatory taxes, putting more burden on existing taxpayers and squeezing the formal sector. He said the right approach should be to increase tax coverage, reduce tax rates, simplify tax regime and adopt a progressive taxation regime.
Khawaja Tanveer Ahmed, Member Account FBR, said the basic theme of new budget was to facilitate regular taxpayers and motivate non-filers towards the tax net. He said Chambers of Commerce should also motivate their members towards tax compliance and FBR will launch awareness seminars in cooperation with Chambers to educate the businessmen on tax obligations. He said we have to sit together to find solutions and business community should assist FBR in improving tax revenue. He assured that government would look into the grievances of the business community to remove their concerns.
