President Pakistan Businessmen and Intellectuals Forum (PBIF), Mian Zahid Hussain has lauded the move of the government to lure foreign companies for investment in Pakistan's debt market. The decision will help reduce Rs 3.4 trillion budget deficit and stabilize foreign exchange reserves which are at $8.27 billion, he said.
He said that the IMF has barred the government from seeking loans from the central bank, therefore, the government has decided to lure foreign investment in government securities etc.
He said that the decision will require amendment in the Income Tax Ordinance 2001 after which such companies would be given 20 percent relaxation in withholding tax, they would be immune from banking transaction tax, advance income tax and filing tax returns.
He noted that interest rates were jacked up to 13.25 percent to boost reserves which has damaged economic activity but results were not very encouraging therefore the decision has been taken to invite foreign companies and banks for investment.
He said the government's move to reverse GIDC Ordinance is laudable and the government should stop paying dues to companies that are holding back billions on account of GIDC.
Rather, the government should adjust dues against GIDC and try to get the issue of Rs 1.3 trillion stuck in litigation between taxpayers and FBR through a full bench of the Supreme Court.