LAHORE: Feedback from the private sector plays a fundamental role in formulating appropriate policies for the trade, industry and economy.
Being premier chamber of the country, the Lahore Chamber of Commerce and Industry has formed a set of proposals for the Federal Budget 2021-22 after various brainstorming sessions and forwarded to the related government departments, said LCCI President Mian Tariq Misbah while talking to Member Inland Revenue (Operations) Dr Muhammad Ashfaq and Member Inland Revenue (Policy) Chaudhry Muhammad Tariq at Zoom on Monday.
He said that LCCI budget Proposals are a composition of the issues being faced by the business community and recommendations for their best possible solution. The lack of balance in the tax incentive structure is resulting in de-industrialization and needs to be addressed. The LCCI has recommended that the incentives which are currently provided to the five zero-rated sectors should also be provided to other important export sectors of the economy e.g. engineering, pharmaceutical, rice and Halal meat etc, he said. All the raw materials which are not manufactured locally should be declared zero-rated through elimination of custom duties, additional customs duties and regulatory duties, he said.
The LCCI President said that the rate of 17 percent sales tax on the inputs of various export oriented industries is extremely high and needs to be brought down. The 3 percent further tax chargeable on all supplies made to unregistered persons should be abolished. He said that the rate of turnover tax should be reduced from the current 1.5 percent for the retail sector. He also said that there should be a single audit for sales tax, income tax and withholding tax. The frequency of this single audit should be reduced to once in 3 years.
He said the commercial importers should be allowed to import against advance payments up to US$20,000. He said that the Lahore directorate of valuation should be empowered like Karachi office to hold meetings of valuation committees since a heavy percentage of importers are from Lahore and up-country areas.
“To facilitate the production of lithium ion batteries in Pakistan, the import duties on its major raw material Li-ion cells (HS code: 8507.6000) should be eliminated,” Mian Tariq Misbah added. He said that the current tax exemptions for the companies engaged in IT business (both local and exports) should be extended for next five years. He said that the sales tax on IT services (infrastructure installation, support and services) must be reduced by 50 percent. The taxes and duties on the used computer systems and laptops should be eliminated. The duties on computer hardware components, printers and networking equipment etc. should be reduced.
Copyright Business Recorder, 2021