Finance Minister Dr Abdul Hafeez Sheikh Thursday said business community and masses will be given special incentives to maintain economic stability in budget for 2012-13. Speaking at a pre-budget seminar, Sheikh rejected the rumours of presenting a 'special budget' to woo masses in the upcoming general elections, saying there is no such plan as it would be a people friendly budget as usual.
"We'd always done what is best for people and this time too it [budget] will be made to maintain continuity of economic policy...reducing rates of custom duty and elimination of federal excise duty (FED) on some more items will be our top priority," he added. Sheikh said the government will focus on maintaining economic stability in a bid to enhance growth. The government is asking US, EU and other neighbouring countries to open market for Pakistani products and incentives would be given in customs duty to enhance trade, he added.
He said the government plans to enhance allocation of Public Sector Development Programme (PSDP) in the budget, besides taking austerity measures to cut current expenditures and reduce borrowing from banks so that private sector could avail loans to invest in businesses. The tax system would be improved to bring more under the tax net, he said.
About increase in salaries of government employees, the minister said that raise will be given in line with inflation and a special programme would be launched to provide employment to 0.1 million youth. Benazir Income Support Programme (BISP) will continue to provide aid to the vulnerable people of the society, he added. Federal Board of Revenue (FBR) Chairman Mumtaz Haider Rizvi said that tax collection had increased by 26 per cent during fist 10 months of current financial year compared to the corresponding period of last financial year.
"The tax rate to GDP may go up to 10.3 per cent during current financial year," he said and ruled out the allegations of poor performance of economic growth. He claimed that rate of indirect tax collection had also increased against direct tax collection. He maintained that National Accountability Bureau (NAB) was conducting inquiry of 28,000 containers and facts of inquiry would be open to every one.
Former Commerce Minister Humayun Akhtar said the government should announce election after budget 2012-13. The government is giving exaggerating figures every year and revenue figures are revised, he said, adding that the government has been cutting development budget every year which is major source of increasing the country's growth. "The economic situation has worsened after 2008 and therefore people transferred money into foreign banks," he said, adding that the government has played Sindh card and now was playing South Punjab card for political gains. "At present, the country is facing crisis of leadership and therefore time is ripe for holding new elections," he said.
Former FBR Chairman Abdullah Yousuf said the government should facilitate private sector in new budget that was driver of the country's growth. "The expenditures are far in excess than actual resources and government should create new avenues of tax collection to enhance revenue," he said, adding that tool of tax machinery should be used to bring more people under tax net.
Former State Minister Finance Umar Ayub Khan said the country had capacity to produce more electricity than the demand.... but the government had intentionally crated power crisis to justify Rental Power Plants (RPPs) to make money. "The power crisis has hit the industry and agriculture sector of the country causing low economic growth," he said and alleged that the government would make Rs 30 billion money through 0.1 million employment in next election. "The government should end the regulatory burden on the private sector to boom it that would provide opportunity for new jobs," he said. He said excess borrowing by the government from banks had frozen the borrowing for private sector. "The government should unleash the private sector," he added.
Vice President Saarc Chamber of Commerce and Industry Iftikhar Malik said the government should bring agriculture sector, hotel, clinics, practitioners and doctors under the tax net in next financial year budget. "The government should form five-year or 10-year economic policy to ensure continuity that will bring confidence in private sector to make future investments," he added.
Representative of Karachi Stock Exchange, Fareed Alam said furnace oil should be provided to the most efficient power plants to end power crisis in the country. "The measures should be taken in new budget to reduce the oil import bill," he said. President Rawalpindi Chamber of Commerce and Industry Javed Bhatti said that government should given economic revival plan in the next budget.
"All Political parties should take joint step to form the economic revival plan with complete parliamentary and legal coverage," he said, adding that the government should allocate money in separate head to overcome energy crisis. He demanded that rate of income tax should be reduced and incentives should be given in manufacturing sector.
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