New taxes worth Rs170b unacceptable: FPCCI
photo: file
The country’s economy cannot sustain the imposition of Rs170 billion new taxes said the president of the Federation of Pakistan Chamber of Commerce and Industry (FPCCI) on Friday.
while addressing the Lahore Economic Journalist Association (LEJA) discussion programme at FPCCI’s regional office on Friday, FPCCI President Irfan Iqbal Sheikh said, “The country’s economy is already suffering and cannot sustain the imposition of Rs170 billion new taxes through a mini budget on the direction of the International Monetary Fund (IMF).”
“Instead of imposing new taxes, the government should plug the loopholes of revenue leakages from electricity, gas and state-owned enterprises, and privatised loss-making entities,” suggested Sheikh.
Urging the government to abstain from putting more tax burden on existing taxpaying businesses, he warned, “The business community will not accept any mini budget.”
“For the last eight to nine months, no multi-national company (MNC) has been able to send their profit back to their principals. Such acts will shatter the confidence of investors and will hinder the inflow of Foreign Direct Investments (FDI),” he warned, urging the government to allow MNCs to repatriate their due profits.
Comparing the cost of production in various countries he said, “In China and Bangladesh, the cost of electricity per unit is 7-8 cents only while in Pakistan it is 20 cents. In addition to this, the markup rate in Pakistan is 17%, while it is 2.8% in China, 6.3% in India and 5.8% in Bangladesh.”
“With such a high cost of doing business, how will Pakistani products ever compete in the world markets,” he lamented. “50% of the containers stuck at the ports have still not been cleared. Importers are now facing demurrages from shipping lines – charging about $120 per container per day.”
The FPCCI president suggested that the government focus on the cheaper sources like renewable, clean energy. For this, he suggested the government remove all duties and taxes on the import of solar panels and equipment to promote solar energy generation in Pakistan. He further stressed the need for coal power to be generated from local coal produced in Thar instead of importing expensive coal.
“The business community has almost completed the Charter of Economy and will present it to the government by the end of February,” said Sheikh, adding that the government should FPCCI and other relevant stakeholders on board while making economic policy decisions so that they can be implemented easily.
“FPCCI has been actively engaged with all political parties in order to accommodate their input in the Charter of Economy,” he said, adding that, “For the last 75 years, politics was the priority in Pakistan, now political parties should prioritise the economy first to stabilise Pakistan.”
Published in The Express Tribune, February 11th, 2023.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.