Business community rejects Presidential Ordinances

Business community termed that the government has imposed a 120-billion-rupee 'mini-budget' through presidential ordinances, envisaging 53 billion rupees of additional taxes on income, imports, agriculture and domestic sales of export-oriented items and demanded its withdrawal.
They said that these measures would bring a flood of price hike of all the products in the country including agriculture and industrial. Further, it would burden already suffering general pubic and increase miseries of low-income group. They noted that through mini budget government imposed 15 per cent flood surcharge, increased special excise duty by 1.5 per cent, withdrew the sales tax exemptions on fertilisers, pesticides and tractors and facility of zero-rating on plant, machinery and equipment including parts thereof was also withdrawn.
They said that the government seems to be unable to visualise the grave economic condition of general public and any increase in taxes will aggravate the situation adversely They said that the decision would be the last nail in the coffin for many Pakistani businesses, especially small and export-oriented companies
An emergent meeting of the Executive Committee of Site Association of Industry (SAI) was held on Thursday, under the Chairmanship of Abdul Wahab Lakhani unanimously endorsed the demand of the Council of All Pakistan Textile Associations (CAPTA) for immediate withdrawal of SRO 231 (I) 2011 and restore status quo of the original SRO 509 (I) /2007 of June 9, 2007 allowing zero rated status to five export oriented sectors.
Lakhani told the meeting that the amendments made to the SRO 509 (I) under the new SRO 231 (I) were bound to create a lot of confusion and chaos due to its ambiguity and the unscrupulous elements were bound to take disadvantage of this for their own benefit. He recalled that before the SRO 509 (I) was introduced these very elements manipulated the refunds system and deprived the Government of billions of rupees by taking illegitimate refunds. Statistics proved that in fact the Government did not retain any revenue collected in the name of Sales tax, which was paid out for bogus refunds.
He also stressed that the present amendments were again bound to open the floodgates of corruption and prove a boon for black sheep both in business and government side. The meeting, thereafter unanimously decided to urge the Government not to create any chaos for the Industry as well for itself and to urgently withdraw SRO231 (I) of 2011
Chairman Korangi Association of Trade and Industry (KATI), Syed Johar Ali Qandhari said that imposition of sales tax on agriculture produce would directly hit prices of agriculture produce, which will move upward increasing miseries of general public. He said that the business community was pleading taxing agriculture sector by imposing tax on agriculture income and not sale tax in agriculture sector.
He also criticised imposition of 4 percent withholding tax on import of pulses, which will have drastic impact on its prices. However, about one time flood surcharge on income tax, he said that the business community might take it as one more contribution towards relief work for flood hit peoples.
He said that overall picture of taxation measures is not very clear yet. It may be clear after issuance of SROs in coming days. Disapproving imposition of new taxes through mini budget, President Site Superhighway Association of Industry (SSAI), Raja Mohammad Ilyas said that India is said to be the biggest enemy of Pakistan and added that the country need no enemy as we our self are biggest enemy.
He noted that whenever taxes increase in the country its export register decline as its products are already uncompetitive in international market. In Pakistan industrial production cost is much higher then other countries of the world. He said that the business community is not against taxes but it is against squeezing only one sector. Income of big landholders must be taxed, he pleaded. He said that income generated by agriculture sector is much higher than the income from industrial sector.