The Overseas Investors Chamber of Commerce and Industry (OICCI) on Wednesday expressed a serious concern over blockage of sales tax refund of Rs 21-22 billion by the Federal Board of Revenue (FBR), which has become a major issue for multinational companies and foreign investors in Pakistan.
Talking to reporters here on Wednesday, the representatives of Overseas Investors Chamber of Commerce and Industry (OICCI) including Secretary General of the body M Abdul Aleem said, "Yes the stuck up refunds is our major concerns,". The FBR has stuck up refunds of foreign companies and corporate entities to the tune of Rs 21 to 22 billion, which has now turned into major concern of leading foreign investors. The inexcusable delay in refund payments has been witnessed without any reason as the amount tied up is less than 2 percent of the amount paid to the FBR.
Flanked by OICCI leaders including Aftab Hussain MD Pakistan Refinery Limited and Moin Mohajir Deputy Secretary General of OICCI on the occasion, Abdul Aleem said that the Perception Survey showed that 86 percent foreign investors termed tax refunds as the major problematic area for them.
They were of the view that foreign companies were concerned because of sit-ins in Islamabad as it was one of the factors which created stumbling blocks for their future investment plans. The higher expectations from the government, according to the OICCI, also played a role in creating distress among the potential investors. The OICCI urges government to show demonstrable support for Intellectual Property Rights (IPRs) protection, a key indicator of business climate closely monitored by existing and potential foreign investors.
Intellectual Property Organisation of Pakistan Act 2012 (IPOP), approved on 6th December 2012 and supported by key stakeholders, including the OICCI, has not been implemented to date. In fact, the government has still not nominated the IPOP chairman, constituted the IPOP policy board or established intellectual property rights tribunals to adjudicate IPR violations, which are essential features of the IPOP," opines President, OICCI Asad S. Jafar.
According to OICCI, IPR violations are widespread, resulting in significant financial and social loss to the government and people of Pakistan. Estimates of sales losses incurred due to IPR infringements by affected companies stand at around Rs 700 billion with the national exchequer losing roughly Rs 190 billion in lost taxes annually, negatively impacting tax-to-GDP ratio by nearly 1 percent.
"The protection of IPR, comprising trademarks, copyrights and patents, is critical for attracting Foreign Direct Investment (FDI) in Pakistan besides encouraging innovation in society and containing rapid brain drain," adds Saad Amanullah Khan, who chairs OICCI's IPR subcommittee.
Leading pharmaceutical and healthcare multinationals, for instance, spend between 15 to 20 percent of their revenue on research and development to introduce new products. Such companies may not be willing to introduce proprietary products in markets that lack adequate IPR protection. The OICCI is also concerned that Pakistan has been on the US IPR Watch List 308 for many years which may deter potential foreign investors. As a body representing the collective voice of 196 major foreign investors in Pakistan and in the interest of attracting inflow of large FDI in the country, the OICCI has regularly interacted with the government, suggesting various measures to improve awareness and protection of IPR in the country.
Comments
Comments are closed.