AVN 67.75 Decreased By ▼ -0.73 (-1.07%)
BAFL 30.82 Decreased By ▼ -0.18 (-0.58%)
BOP 4.84 Decreased By ▼ -0.07 (-1.43%)
CNERGY 3.75 No Change ▼ 0.00 (0%)
DFML 14.05 Decreased By ▼ -0.18 (-1.26%)
DGKC 41.04 Decreased By ▼ -0.60 (-1.44%)
EPCL 47.21 Increased By ▲ 1.84 (4.06%)
FCCL 11.58 Decreased By ▼ -0.13 (-1.11%)
FFL 5.11 Increased By ▲ 0.01 (0.2%)
FLYNG 5.95 Increased By ▲ 0.10 (1.71%)
GGL 11.17 Increased By ▲ 0.76 (7.3%)
HUBC 67.68 Decreased By ▼ -0.82 (-1.2%)
HUMNL 5.71 Decreased By ▼ -0.04 (-0.7%)
KAPCO 28.03 Decreased By ▼ -0.19 (-0.67%)
KEL 2.28 Increased By ▲ 0.02 (0.88%)
LOTCHEM 26.25 Increased By ▲ 1.15 (4.58%)
MLCF 21.58 No Change ▼ 0.00 (0%)
NETSOL 86.53 Decreased By ▼ -1.82 (-2.06%)
OGDC 99.78 Increased By ▲ 0.48 (0.48%)
PAEL 11.08 Decreased By ▼ -0.03 (-0.27%)
PIBTL 4.23 No Change ▼ 0.00 (0%)
PPL 80.05 Decreased By ▼ -2.40 (-2.91%)
PRL 13.26 Decreased By ▼ -0.08 (-0.6%)
SILK 0.90 No Change ▼ 0.00 (0%)
SNGP 43.75 Decreased By ▼ -0.63 (-1.42%)
TELE 6.08 Decreased By ▼ -0.10 (-1.62%)
TPLP 15.88 Increased By ▲ 0.07 (0.44%)
TRG 121.33 Increased By ▲ 1.58 (1.32%)
UNITY 14.04 Decreased By ▼ -0.06 (-0.43%)
WTL 1.31 Increased By ▲ 0.05 (3.97%)
BR100 4,181 Increased By 9.7 (0.23%)
BR30 15,270 Increased By 16.5 (0.11%)
KSE100 41,723 Increased By 200.6 (0.48%)
KSE30 15,746 Increased By 83 (0.53%)
Follow us

KARACHI: Overseas Investors Chamber of Commerce and Industries (OICCI) Secretary General M Abdul Aleem has termed the 2021-22 budget proposals overall positive and growth oriented.

He said that in view of the limited fiscal space available to the government and the continuing Covid-19 related challenges, the authorities had focused on ease of doing business and in facilitating manufacturing in Pakistan.

The rationalisation of customs tariff on a large number of imported raw materials will have a positive impact on the manufacturing in major sectors like textile, pharma, chemicals, steel, foods etc. Reduction in general rate of minimum tax from 1.5 percent to 1.25 percent, with the commitment to reduce it gradually in the coming years, and from 0.75 percent to 0.5 percent for refineries and rationalisation of 12 withholding taxes appears to be steps in the right direction.

This together with measures to take away unnecessary provisions in the tax regime, like section 122(5A), which were abused by some officials together with selective tax audit by third party are seen as steps towards ease of doing business. Further, removing final tax regime on certain class of income, allowing 100 percent in-put sales tax adjustment for listed companies, which was limited to 90 percent of output tax, and reducing capital gain on disposal of securities are positive measures for the economy.

New measures were also announced to facilitate telecom and IT exports. Introduction of Special Technology Zones is also a positive initiative towards boosting digital landscape in the country, and similarly recognising telecom as industrial establishment will bring them at par with other sectors of the economy. However, certain additional taxes on usage of telecom facilities will negatively impact the telecom companies and need to be reviewed by the authorities.

The government has also announced some bold measures towards broadening the tax base including incentivizing the retail sector with tax credit for using Electronic Point of Sale machines.

A few key matters not addressed, or only partially addressed, include continuation of the minimum tax regime as organisations with large turnovers but low profit margins would continue to be subjected to turnover tax, albeit at a lower rate of 1.25 percent which raises their tax liability to twice the normal tax rate. Another key issue overlooked is the recommendation by most businesses to incentivise investment in manufacturing, by restoring sections 65B, 65D & 65E, which were deleted through a tax amendment ordinance earlier in the year, he said.

While no new incentives had been announced for new investment in plant and machinery or specific incentives for foreign investors the overall sentiment was towards ease of doing business making budgetary measures, by and large, business friendly, he added.

Copyright Business Recorder, 2021

Comments

Comments are closed.

OICCI terms budget growth-oriented

IMF talks: ‘Some understanding’ reached: MoS Pasha

Qatar agrees to buy OGDCL, PPL shares

PM forms body to activate STZA

Primary deficit: Rs500bn waiver sought from IMF

First six months: Fiscal deficit swells to 2pc of GDP

Petrol shortage hits major cities of Punjab

New landfill sites: Govt decides to alter ICT master plan

Joint sitting of parliament: Rabbani deplores non-inclusion of terror issue in agenda

Real estate owned by overseas Pakistanis: UAE authorities do not share info

PM gets seven more special assistants