F.P. Report
LAHORE: The Pakistan Business Forum (PBF) Saturday suggested the government to take effective austerity measures in the public sectors and prepare the next federal budget in a way that encourages business activities in the country.
PBF President Mian M Usman Zulfiqar stated this while sharing the budget proposals with the media here. Forum’s Vice Presidents Jahanara Wattoo, Chaudhry Ahmad Jawad and core committee members also accompanied him.
Mian Usman stressed the need for establishing export warehouses at the borders to uplift trade with neighboring countries and incorporating the agriculture and service sectors into the tax net.
In an effort to increase the GDP growth up to six per cent, the budget makers would have to broaden the tax base and reduce tax rates enabling Pakistani products to have a competitive edge in the global market, he added. “We want jobs creation by strengthening industry; broadening of tax base through lowering rate; and introducing viable policies to attract foreign investment,” he added.
During the last three decades, he said, it was only thrice when Pakistan’s economy grew by more than five per cent i.e. during 2003-2006, 2016-2018 and 2021-22. The industrial production could be increased by realising the full potential of information technology, he said, citing that digital finance potential of Pakistan could be US$36 billion in next four years thus giving a seven per cent boost to GDP and generating four million new jobs.
The PBF president was of the view that real fact was a lack of realisation as the world business patterns had changed and Pakistan had made no efforts to adjust to those realities. “If the country wants to have a higher growth rate, it would have to adopt new innovative ways in the post-pandemic world as is being done by other countries, which are expecting a fast V-shaped recovery. We need to bring our digital infrastructure at par with other fast developing countries, besides adopting new technologies and implementing e-government solutions,” he suggested.
Similarly, PBF recommended the government to abolish the Super Tax, which was imposed on companies earning more than Rs150 million last year and the cement, steel, sugar, oil, gas, fertilizers, textiles, automobiles, tobacco, and other industries were among them.
The PBF president also urged that general rate of Minimum Tax under Section 113 of ITO 2001 to be reduced from 1.25 per cent to 0.25 per cent. “Considering current economic turmoil and inflationary pressure on prices and cost, the minimum tax should be abolished at least for listed companies,” he mentioned.
PBF Vice President Jahanara Wattoo proposed the economic managers to incentivise investors; simplify tax system and take solid step to reform the tax collection departments; and rationalise import tariff with other competing countries.
Jahanara urged the government to take practical and concrete steps for the implementation of business-friendly policies, saying that high prices of utilities like electricity, gas and petroleum products were slowing down the wheel of economy. She added, there was a need to freeze the prices of those inputs for at least three years so that the economy could get required jumpstart.
She also suggested that the sales tax slab should immediately be curtailed in order to reduce cost of production and inflationary pressures. The government should reduce sales tax to single digit and also cut corporate tax to make the upcoming budget business-friendly,” she added.
However in order to tackle the energy shortages, she suggested, maximum funds should be allocated for construction of dams or water reservoirs because country was in dire need of an urgent shift in its energy-mix in favor of hydro power and local fuels.
PBF Vice President Chaudhry Ahmad Jawad said the slowing down of agriculture sector growth was causing serious repercussions on all aspects of the economy including inflation, poverty, employment, income distribution, current account and food security. In this regard government must announce tangible steps in the upcoming federal budget including curtailment of fertilizer prices and electricity tariff on tube-wells – aimed at bringing down high prices of agriculture inputs.
Jawad proposed that the government should announce concrete package in the budget for the facilitation of horticulture industry as its global trade crossed US$250 billion. Funds should be allocated to promote hybrid seed industry in Pakistan under private-public partnership to increase per-acre yield. “The world is focusing on the use of certified seed for enhancing agriculture productivity due to better profitability and international recognition,” he remarked.
Similarly, the government should incentivise businessmen to invest in latest cold storages as it was a vital part of the supply chain for exporting fruit and vegetables as well as for local markets with a tax exception for five years; to chase the target of 900 state-of-the-art cold storages, he added.
Jawad said that loan scheme for new agriculture graduates should be government’s priority in the budget to promote agri services, adding that special mark-up rate could be announced for the banks preferably at five percent to import used agriculture machinery to facilitate farming community. (APP)
