The Federal Budget 2005-06 is growth-oriented and business-friendly, and would further promote the business activity in the country, members of the Institute of Chartered Accountants of Pakistan (ICAP) and Institute of Cost & Management Accountants of Pakistan (ICAMP) said on Monday, following announcement in the National Assembly.
They said that duty exemption on different raw materials and machinery for export-oriented industries and incentives for agriculture sector would help the local industry to make its products more competitive in the global market. Moreover, the decision regarding increase in pay and pensions for salaried class would result in mitigating the sufferings of this class, caused by rising inflation in recent months.
ICAP President Zafar Sobani said that incentives for export-oriented industry in the budget would bring respite for the local industry, which is struggling in global market. The steps taken in budget, like duty reduction on import of raw materials and machinery and other items would also lower the cost of running the businesses, which would make the products more competitive, he added.
Terming the overall budget as business-friendly, he said that huge allocations for development sector are also meant for industrial development by improving the infrastructure, which is of utmost importance for industrial growth of any country.
He hailed the increased allocations for the social sector calling it a positive step as it is very essential to improve this sector for greater benefit of the people of country. He, however, added that a lot was needed to be done in it regard.
Sobani said that the government had accepted most of the proposals of the Institute in the budget, particularly its suggestion regarding the increase in pay and pensions of government employees.
Member, ICMAP, Badaruddin Fakhari, said that zero-rated import of raw materials and machinery for export-oriented industry was a positive step. However, it would be better if the government allowed free import of raw materials and machinery for all industries.
Regarding development allocations, he said that it was a right step for infrastructure improvement for industrial growth. However, the government must also ensure proper and timely utilisation of this huge development allocation.
Regarding the 0.1 withholding tax on withdrawal of cash of Rs 25000 or above from banks, Fakhri opined that it would not contribute bulk revenue in government exchequer; so, it would have been better not to introduce it for facilitation of customers.
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