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KARACHI: Shabbir Hassan Mansha, the acting president of Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has said that the business community was expecting an industrial package to propel the country into the much-needed industrialisation and import substitution mode.

He said the business community is concerned at the imposition of wealth tax on tax-paid assets as well. Mr Mansha was of the opinion that the federal budget for 2022-23 is devoid of categorical explanations about various budgetary and fiscal initiatives.

He welcomed the emphasis on setting up of special economic zones (SEZs) under the China-Pakistan Economic Corridor (CPEC) and also commended the imposition of fixed tax on small retailers, as this will make it viable for them to register into taxation system.

He expressed dismay that FPCCI, being an apex body, had proposed to the government to announce a comprehensive industrial package, as there is no other way to control the unsustainable trade deficit that contributes to current account deficit, which will be $47-48 billion this year, gradually reduce debt servicing of Rs 3.95 trillion, protect the ever-depreciating rupee that results in massive fuel and power inflation, save dwindling foreign exchange reserves, increase growth rate which is grossly insufficient to match the population explosion, deal with increasing unemployment and curtail the budgetary deficit through generating more taxes through productive activities, and not through squeezing the existing taxpayers even further.

Addressing the other area of concern, he said that remittances recorded a significant decline of 25 percent in May 2022 on a Month-on-Month (MoM) basis, and FPCCI had categorically suggested that incentives be provided to facilitate remittances.

The acting head of the FPCCI said selected commercial bank branches should be open 24/7 in all major cities and towns of Pakistan to facilitate remittances, taking care of time lapse in emergency circumstances and varied time zones.

He noted with a sigh of relief that zero tax has been levied on agricultural machinery and inputs, which was a major demand of the FPCCI given the food security situation in the country. “Exempting tractors and seeds was critically needed and the government listened to us on the issue,” he added.

However, fertilisers should also have been exempted as it is one of the major inputs for higher yields.

Mr Mansha appreciated the relief extended to the middle class by raising taxable salaried income threshold to Rs 100,000 per month from the current Rs 50,000, and also providing relief to micro and small businesses by raising the minimum tax bracket from Rs 0.4 million to Rs 0.6 million.

He maintained that property tax of 1 percent on properties worth over Rs 25 million should be reconsidered, as in times of crises all segments and sectors of the economy should be supported. It is pertinent to note that real estate and construction sectors directly or indirectly accelerate growth in 40 industries, he added.

Copyright Business Recorder, 2022

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