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Print Print 2023-12-08

Ways identified to salvage economy, back businesses

  • Country’s top businessmen urge government to reform Federal Board of Revenue
Published December 8, 2023

ISLAMABAD: The country’s top businessmen on Thursday urged the government to reform Federal Board of Revenue (FBR), implement ease of doing business policies, dismantle illegal import trade through Afghan Transit Trade, mis-declaration, under invoicing and establish compliance.

They presented these recommendations at a meeting of Industrial Advisory Council, organised by Ministries of Commerce and Industries under the chairmanship of caretaker Federal Minister for Commerce and Industries and Production, Gohar Ijaz who sought proposals to increase exports to $100 billion over the next few years.

CEOs Fawad Ahmed Mukhtar, Muhammad Ali Tabba, Waqar Ahmed Malik, Abdul Samad Dawood, Raza Mansha, Shahzad Asghar Ali, Samir Chinoy, Amir Fayyaz Sheikh, Shahbaz Yaseen Malik, Ahsan Bashir, Syed Hyder Ali, and Farooq Naseem shared their views on the current state of affairs and proposed different policy actions to achieve the target.

Five major categories of ATT cargoes: 10pc processing fee abolished

Industrialists asked for rationalisation of the taxation system and to simplify and reduce government intervention to improve ease of doing business and incentivise industries, enhance trade and commerce diplomacy, sign Free Trade Agreement (FTA) with USA, and build Pakistan.

Curtailment of government borrowing, enforcement of fiscal discipline and reduction in size of government was also part of their demands.

They also proposed a reduction in line losses of power sector companies and a move towards cost-efficient generation, transmission and distribution. They also asked for presentation of their demands at Special Investment Facilitation Committee (SIFC) forum.

Gohar Ijaz, in his remarks criticised local industry for not delivering despite enjoying substantial benefits in the past. The government gave drawbacks, DLTL, export refinance, incentives to exports related to specific products other than normal products, and bearing the transportation cost to other countries but growth in exports is negligible, he added

“We did everything during the last 15 years. In June 2023, Pakistan’s exports were $ 27.50 billion of which share of textiles was $ 17 billion, non-textile and agriculture exports were just $ 5 billion each, respectively,” he said, adding that Pakistan has reached $ 5 billion level in non-textile export in 76 years, and adding that industrialists are partly ‘typo blame’. He said the government has continuously been extending support to industry since 2005.

“Our mission is to reach the level of $ 100 billion through export-led growth from current $ 30 billion in the next five years. During this period, economy’s size has to be taken to $ 1 trillion from present $ 350 billion,” he continued.

He further argued that industry wants deregulation and a free market economy, adding that it is being suggested that the fertiliser sector should remain regulated or else the farmer will be crushed. Ijaz contended that the fertiliser sector is not benefiting from a subsidy of Rs 5 billion on gas as it goes to provide farmers cheap urea.

He said, gas reserves of Mari Gas, on which the existing fertilisers are operating, will deplete in the next five years, adding that the country has to formulate a long-term policy. He maintained that the profit of fertiliser dealers is higher than Fauji Fertilizer, Fatima Fertilizer and Engro Fertilizer.

Talking about auto sector, he said, Pakistan imported vehicles worth $ 50 billion in 30 years, and $ 10 billion was repatriated to their principals during this period. He said the new auto 2021-26 policy is not succeeding in getting support from the deletion structure.

“We have to give them the next five years’ policy today so that they can prepare themselves for deletion,” he added. He said, Toyota, Honda and Suzuki had to export their variants due to the Auto Policy 2021-26 and when he asked them to honour their commitment they blackmailed him. “The auto policy was approved and when I started implementation on it in 2023, they got angry. We need to sit down and find out the solutions,” he further maintained.

He said the state cannot give subsidy as total tax revenue is projected at Rs 9.4 trillion, which equals interest payment of Rs 9.4 trillion as the stock of deficit that has reached Rs 40 trillion. He asked the Council to provide a solution to the high energy cost.

“Until tax revenue reaches Rs 18 trillion, tax to GDP ratio 17 or 18 per cent, the country cannot function smoothly,” he added. The Council Members have to give solutions, he said. He cited the reference of sugar industry, which is now complaining after the stoppage of sugar smuggling.

Copyright Business Recorder, 2023

Comments

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TimetoMoVVeOn Dec 08, 2023 08:08am
Just start trading with the world's 5th largest and soon to be the 3rd largest economy. Besides that nothing else would work.
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KU Dec 08, 2023 10:29am
Valid suggestions by the business community but rent seeking economic system is the lifeline of our Raj, they will never let it go, even if it means a bankrupt Pakistan. In perspective, India exported 34 billion dollars jewelry alone in 2021. We on the other hand are led by self serving leaders and baboos who are qualified incompetent and greedy.
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Imran Dec 08, 2023 11:10am
Export growth comes from industrial revolution and servicing sector +IT Need to build industrial estates in all cities with low cost of land enabling to let new industry to grow and foreign investors can also participate (like china) presently 10mil rups per acre is too much Servicing sector need to be supported by low cost financial solutions enabling to achieve maximum growth same likewise iT and furthermore direct taxes of wealthy persons shd b identify and pay 1mil each (100000) individuals shd b set target of fbr and all stores shd pay direct tax of min 10000 to 100000 (depanding upon d size of shop) to get maximum support for budgetery deficit and further economic development
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Builder Dec 08, 2023 11:43am
Looking at history, direct taxes can't be collected with justice. There is just one solution - increase GST, abolish individual income tax and compensate the increase in GST to the poor through income support funds.
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Hakmat Dec 08, 2023 01:06pm
Respected sir my whatsapp doesnt sending me verification otp. I am trying from about two week but every time its giving time of one hour but after completion of this time when i try again again its give time of one hour and voice vorsa.Even i ma following all the rules and regulations of whatsapp. I request you sr plz review my whatsapp account and number and fix this problem as soon as possible.i will be very thankful to you.My whatsapp number is 03192679181.And my gmail account is [email protected].
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