LAHORE: Renowned economist and academician Dr Qais Aslam has advised the government to withdraw General Sales Tax (GST) on 1000 essential items of daily usage in the upcoming budget.

Talking to this scribe, he has also stressed on curtailing fiscal deficit by cutting unnecessary expenditure, especially the financing of public sector entities that are in perpetual deficit. Fiscal deficit has reached 10% of GDP, which is an alarming situation, he added.

He said the government should heavily tax luxury items, property and professional services. However, tax on inputs should be reduced to 10% and tax and duties on exportable and machinery for export production should be eliminated altogether.

The difference should be taken from enhanced tax on imports and sales of luxury and items of seldom usages. Exports by small and medium enterprises (SMEs) of non-traditional items should be encouraged through tax incentives and rebates to diversify export items and markets, he added.

Also, he said, imports of non-important items luxury items should be stopped for the next six months. Dr Aslam has further proposed that commodity prices should be rationalized in rupees rather than in dollars by capping it at 175 Rs to a dollar for the time being.

He pointed out that rebate on income tax profits should be extended to regular taxpayers among the middle class. The government should encourage remittances through monetary incentives to each dollar sent through official channels, he said.

He said the government should also focus on introducing electric buses and encourage sharing against single usage of cars to save import of oil. So far as import of cooking oil is concerned, he said, it should be substituted with indigenous sources of dairy and vegetables.

He has also appreciated the prime minister’s approach on early completion of dams for water and electricity security. He said the government should also give primary jobs to unemployed youth and labor to increase productivity.

He said the issues like public skill enhancement, clean drinking water and climate change, and environment are long term issues which should be left to the next government coming into being in the wake of general elections ahead. In addition, he said, land reforms and economic vision should also be left to the next government.

On the electricity generation, he said, the government should encourage production by environmental-friendly indigenous resources.

Copyright Business Recorder, 2022