Business Community has termed the federal budget for the year 2004-05 as growth-oriented and business friendly saying that efforts have been made to reduce cost of doing business and hoped that it will boost investment in the country.
Talking to newsmen after the presentation of budget by Federal Finance Minister Shaukat Aziz, Siraj Kassam Teli, President of Karachi Chamber of Commerce and Industry (KCCI), said that the budget is businessmen friendly and hoped that 8 percent growth target proposed by the finance minister is quite achievable.
He pointed out that during last meeting with the Finance Minster in Karachi, the chamber has presented its budget proposals out of which around 90 percent have been excepted.
Siraj Kassam elaborated that the chamber has proposed flat rate of 10 percent sales tax whereas the finance minister has fixed it at 15 percent, which is good for business community.
The KCCI chief said that allocation of Rs 202 billion for development would improve the infrastructure condition considerably.
He hoped that the measures adopted in the budget would pave way in making the country's products competitive in international market as well as to face WTO challenges.
Siraj Teli said the budget would help boost development of Small and Medium Enterprises (SMEs) in the country and enhance investment in the construction sector.
He claimed that it was the demand of KCCI to withdraw three present taxes, which was accepted.
The KCCI chief said that the chamber proposed total withdrawal of import duty on machinery not manufactured in Pakistan whereas the finance minister has allowed reduction of 5 percent in duty. This sector needed to be looked further, he stressed.
Haroon Rashid, Vice President of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and Iftikhar Ali Malik, Former President FPCCI have hailed the Budget for the year 2004-5, as the best possible and has termed it as extremely business friendly and meeting the aspirations of the general public.
They especially appreciated the relief of 58 paisa per unit to industrial consumers, 25 paisa to commercial users and 10 paisa to domestic users of electricity, and has opined that it would substantially reduce the input cost as well as cost of doing business in Pakistan, ensuring competitiveness in the international market of local products.
The total development outlay of Rs 202 billion is a record allocation in the history of Pakistan and this would greatly help in poverty alleviation and would be a catalyst in enhancement of industrial activity, both businessmen viewed.
The special emphasis on the agriculture sector, which constitutes 26 percent of our GDP and covers 65 percent of the total employment was highly appreciated in the form of getting duty and sales tax and withholding tax relief on the imports of tractors of 35 to 100 Hp, and implements not produced locally, besides getting the duty relief on DAP urea, furthermore the availability of concessional financing on agriculture loans.
The 134 percent increase in education sector by allocating Rs 13 billion and 50 percent increase in health sector by allocating Rs 6 billion, the government has shown special considerations for the social sector and this would be of special help to the toiling masses.
The other programmes such as National Technical and Vocational Programme and Rural Development Support Pilot Programme and Women Development Programme of 100 million are indeed appreciable.
Rs 50 billion subsidy on the overall power sector would help in reducing the input cost of the industrial and manufacturing sector.
Housing industry has again been encouraged by eliminating custom duty and sales tax on paints, varnishes and stream lining the NOC and procedures.
Food support, micro financing and Khushhali Bank and Zakat were other measures announced in the Budget, which would reduce the poverty level.
Iftikhar Ali Malik and Haroon Rashid appreciated the reduction in custom duty on CBU of vehicles and elimination of withholding tax on import of machinery by commercial importers.
The extension of capital gain tax till 2007 was also appreciated, as it will give boost to the stock exchanges and would help in attracting foreign as well as expatriates investment.
Welcoming the announcement for the preparation of a national industrial policy, after its discontinuation in 90s, Shaikh Manzar Alam, Chairman Advisory Board Korangi Association of Trade and Industry (KATI) has emphasised that solution to all economic ills lies in accelerating the pace of industrialisation.
He said that industrial development is dependent on agriculture for its raw materials and markets, therefore, the future of industrialisation is deeply linked with the modernisation of farms.
Zubair Motiwala, Former President of KCCI, said that the budget has provided relief to business community hoping that industrialists will make efforts to avail opportunities and would invest in the country.
He also appreciated increase in income tax exemption limit from Rs 80,000 to Rs 100,000.
Munir Sultan, Vice Chairman, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) standing committee on Housing and Construction Industry, said the concessions provided in the budget would benefit general public.
He said that the measures taken to grant approval of building plan, sales tax exemption for paint industry, providing housing loan on easy terms, reduced mark up, tax reduction etc will bring boom in the construction industry.
Munir Sultan pointed out that the builders were demanding for incentives as this sector creates large number of jobs.
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