Stable political environment needs for economic reforms: UBG

KARACHI: President United Business Group (UBG) Zubair Tufail has said that it is a fact that the country's economy is in dire need of reforms, which is possible only in a stable political environment.

It is true that no new tax has been imposed in the budget, but imposing a 100% tax burden on the electricity provided to the export industry will not be beneficial in any way because the increase in electricity from Rs 20 to Rs 40 will reduce textile exports by 25-30%.

The domestic exports are already decreasing due to which the inflow of dollars in the country is also decreasing, so the government should reduce the electricity tariff for the industries to boost exports.

Tufail said that the political instability in the country has badly damaged the economy. The government has increased the tax burden on corporate sector. He said difficult decisions must be made to make the economy competitive but instead of putting unnecessary burden on the already taxpayers, new taxpayers should be brought into the tax net.

Zubair Tufail further said that the government has to correct the fundamental factors of the economy and strengthen the economic foundations to create a business and investment friendly environment. “We need to improve our regulatory environment and make the system work, while providing opportunities for people to invest and work.”

He said the government should build confidence among investors to invest in the economy. But if the inflation is 20 to 21 percent, then how will it be possible to increase the tax by 35 percent?

Zubair Tufail said that taxing the transaction again like in 2006 will increase the grey economy. It is necessary to reduce the losses of export industries including the textile industry, so that export and manufacturing sectors can achieve their targets.

Copyright Business Recorder, 2023