Don’t kill the goose that lays the golden egg, SITE body tells FBR, others

KARACHI: SITE Association of Industry (SAI) in its budget proposals for the year 2024-25 forwarded to the Prime Minster, Finance Minister, Governor SBP, Chairman FBR and others, President SAI Kamran Arbi warned the government to avoid “killing the goose that lays the golden eggs!” “For increasing the tax-to-GDP ratio, the government should bring the untaxed and under taxed sectors of the economy into the tax net”. “Overburdening of the crucial Industrial sector runs counter to Pakistan’s economic development goals”, says the SAI proposals.

SITE, Pakistan’s Industrial Powerhouse and the SITE Association of Industry (SAI) is the voice of Pakistan’s largest & most diverse industrial base. The Industrial Sector contributes 20-22% to the GDP and bears over 50% of the national tax burden.

SAI’s eight key recommendations to Government encompass four areas of policy making: fiscal, monetary, trade and energy policies. SAI demands,

1. Substantial reduction in direct and indirect taxation measures on industries.

2. Reduction in corporate taxation, dividends and on salaried persons.

3. Removal of unnecessary restrictions on import of industrial inputs.

4. Implementation of a single cascaded rate of import tariffs on industrial inputs and removal of additional and regulatory duties.

5. Provision of a predictable forex regime with 12-months forex cover for imports and exports.

6. Revision of energy policies to reduce electricity and gas tariffs for industries.

7. Progressive reduction of policy rates to stimulate industrial and economic growth.

8. Lowering of lending rates for industrial projects and exports to a single digit.

SAI emphasized that the Federal Budget should take a strategic direction and go beyond a tactical number crunching exercise.

The federal budget should:

• Exercise prudent debt management strictly under The Fiscal Responsibility and Debt Limitation Act, 2005.

• Prioritize allocations for national exigencies, particularly for reindustrialization.

• Enable prudent economic, social, and regulatory policymaking.

• Ensure transparency, accountability, and responsible public spending.

• Drive economic growth by stimulating investment and creation of jobs

“Proposed budgetary measures if introduced will foster industry-driven economic growth in Pakistan, IN-SHA-ALLAH” said the SAI Budget document.

Copyright Business Recorder, 2024