Electricity bills: LCCI for withdrawing fixed charges, reducing taxes

LAHORE: The Lahore Chamber of Commerce & Industry has demanded of the government to withdraw fixed charges and reduce the number of taxes in electricity bills saying that these are a heavy financial burden on the business community.

LCCI President Mian Abuzar Shad, Senior Vice President Engineer Khalid Usman and Vice President Shahid Nazir Chaudhry while expressing their concerns and said that these additional costs are exacerbating the challenges faced by businesses already struggling with rising operational expenses.

The LCCI office-bearers said that the cumulative impact of escalating electricity costs, along with fixed charges and taxes, is making it difficult for businesses to stay competitive. They said that these charges are particularly damaging to the manufacturing and export sectors, which are already under pressure in the global market. The additional financial strain on these industries threatens to reduce production capacity, impact employment and hinder overall economic growth.

They added that the business community is already facing multiple challenges, including rising inflation. The imposition of fixed charges and increased taxes on electricity bills only adds to the financial burdens businesses are enduring. The government must urgently intervene to remove fixed charges and reduce the number of taxes on electricity tariffs to ease the strain on businesses.

The LCCI office-bearers specifically noted that small and medium-sized enterprises (SMEs), which are the backbone of Pakistan’s economy, are bearing the brunt of these rising energy costs. As a result, many businesses are struggling to maintain operations and some are even being forced to reduce their workforce or scale down production. This is negatively affecting job creation and economic output across the country.

They urged the government to reassess the current electricity pricing structure and implement reforms to make it more business-friendly. They demanded elimination of fixed charges, simplification of the energy pricing system and reduce taxes on electricity bills to support businesses in recovering from the adverse effects of the pandemic. “If these burdensome charges are not addressed, we risk further damage to industrial production, which will have a cascading effect on other sectors of the economy. The government must take decisive action to ensure that businesses can operate competitively and create more job opportunities, which are essential for Pakistan’s economic growth,” they added.

The LCCI leadership said that the rising electricity costs are driving up the prices of goods and services, which ultimately diminishes consumers’ purchasing power besides badly affecting the exports. This cycle of inflation can stifle economic growth and negatively affect the standard of living for the general public.

The LCCI office-bearers called for a long-term energy strategy that includes a focus on renewable energy and energy efficiency. They urged the government to invest in alternative energy sources and energy-saving technologies to reduce electricity costs in the future.

Copyright Business Recorder, 2024