SME Policy 2021: 'It should be based on low tax rate, no audit and no harassment': FPCCI

ISLAMABAD: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has proposed that the "SME Policy 2021 should be based on low tax rate, no audit, and no harassment".

The FPCCI, in its recommendations for the upcoming policy has proposed that the SMEs to be classified as small and medium size enterprises with turnover, and number of employees separately.

According to the FPCCI, formation of the National Coordination Committee (NCC) on SME development is a good step forward, suggesting that representation should also be given to the FPCCI, the CCIs, and other trade bodies and associations.

The FPCCI is of the view, the terms of reference (ToRs) should define key standard operating procedures (SOPs) for the meetings to ensure effective and efficient outcome.

The FPCCI has recommended the simplification of taxation, which it can share at the time of actual consideration. On concessional loans on easy terms, the FPCCI said that the SBP has issued some notification, which needs to be improved by capturing the difficulties of small businesses in Pakistan.

Talking about collateral free lending, the FPCCI maintained that the SBP has issued notification, which needs to be looked into, debated and made practical, taking into account the difficulties coming in the way of its objective success to make the finances available to the SME business Commenting on allocation in special economic and industrial zones and parks, the FPCCI is of the view that new special and industrial zones and parks should be dedicated to micro and SME enterprises, so that the individuals in the cluster can understand from each other's experience and raise a collective voice towards objective development of the enterprises.

The FPCCI is also of the view that the land should be dedicated for micro and SMEs in the present ongoing special, industrial zones and parks. Sharing its views on registration portal, the FPCCI has proposed that the Smeda should have registration portal as a single agency and sharing data with the FPCCI, so that Smeda and the FPCCI can take-up the issues for sustainable improvements by way of changes as to be effected from time to time by considering the requirements.

For local and international market access, the FPCCI is of the view that in the local and international exhibitions the SME should be given access through the fund created as SME development fund or from Export Development Fund (EDF) as an initiative, which can be introduced through amendments in administrative rules of Fund.

The FPCCI has also argued that in the public procurements, the enterprises should be facilitated in their registration for participation in the public procurements, for which the PPRA, provincial PPRAs and SRO 827(I)/2001 of December 3, 2001 require a review to accommodate the demand side initiative.

For demand-driven skill programme supports, the FPCCI has proposed that the enterprises should be introduced to all the donors and their capacity be developed through national sponsored programmes.

Presently, there is a difficulty in easy access to funds from foreign donors due to restrictions by the Economic Affairs Division and other agencies. A well-structured advocacy by the Smeda with the help of the FPCCI can provide access to funds other-than from resource constraint situation with the Government of Pakistan.

A special Smeda Development Fund should be created for objective steering of the success of the policy framework and initiatives thereof. The FPCCI has further proposed that the USAID, the GIZ, the FES, the DFID, and other the donors should be welcomed for fund raising under a trust to be managed with audits and surveillances required thereof.

The FPCCI has proposed that reforms be initiated and ease of doing business on special and differential treatment should be accorded to micro and SME. Harmonisation of all food authorities in respect of operations as per the PSQCA national standards.

All incentives offered under the SME Policy must be linked to SME Card/Registration on Smeda Registration Portal, to be managed by the Smeda in association of an advisory committee to include the FPCCI and provincial headquarter based CCIs to keep examining the practical difficulties and suggesting solutions for onward take-up with the respective governments.

All the provincial and federal levies to be clubbed to make a single levy to be charged either as percentage of turnovers or in some other mode to also protect the present collections for the purposes these departments have been created.

The FPCCI has also proposed that given the inter-ministerial nature of the SME Policy, the prime minister should hold periodic review meetings to monitor progress and issue directions as has been the case for regulatory guillotine/reforms.

Sector-wise working groups should be made, so that the people from the relevant business are become part of those working group, further the nominees of the FPPCI should also be taken as member of each working group, this will help to achieve the government objectives and the FPCCI can play its role for its member bodies in development of the SMEs.

Copyright Business Recorder, 2021