Representational image. PHOTO: REUTERS

Business relief package demanded

PBC sends letter to PM aide with proposed relief plan


​ Our Correspondent March 31, 2020
KARACHI: The Pakistan Business Council (PBC) has welcomed the economic relief package announced by the government and has suggested supplementing it with a business relief package to have a maximum impact.

In a letter written by PBC CEO Ehsan A Malik, the draft of the business relief plan has been presented to Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh.

The package has been prepared on the assumption that the government will be willing to defer or forego taxes from the private sector and the primary focus will be on retention of employees, continued payment of salaries to them and assisting cash flow of manufacturing businesses during the crisis period.

According to the letter, the main components of the package include sales tax and excise duty due to be paid by the manufacturing businesses for February, March and April which, it said, should be accumulated and allowed to be paid in six equal installments commencing July 2020.

Apart from that, the additional sales tax of 3% at the import stage should be abolished for the manufacturing sector.

The second important component was income tax. The PBC said turnover tax should be brought down to 0% from 1.5% currently for tax years 2020 and 2021.

Tax should be levied on the assessed profit of businesses, it said, adding that the tax on imports and the collection on goods, services and contracts should be suspended for six months. Furthermore, additional customs duty of 4% and 7% on goods with normal customs duty of 16% and 20% should be reduced to 2% with immediate effect.

At the provincial level too, some major issues were highlighted by the PBC CEO. He stated that the Sindh Infrastructure Development Cess should be withdrawn or at least deferred for the next 12 months and property tax on businesses should be reduced by 50% for FY20.

Published in The Express Tribune, March 31st, 2020.

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