Office-bearers of the Lahore Chamber of Commerce and Industry (LCCI) and representatives of different segments of the industry have termed the federal budget 2004-05 as a balanced budget.
The LCCI Chief, Mian Anjum Nisar said that over all it was a balanced budget. He said that the tax target of 580 billion of rupees set for the next fiscal, although was a difficult target but the way their economy had shown growth in the current fiscal it would be achieved.
'It was an outstanding demand of the LCCI that utility charges to be should be reduced and the government has announced a 58-paisa per unit relief for the industrial electricity consumer.
This decision would help bringing down the input cost of the industry but there is still a room to bring it further down, as we have to compete various countries of the region', he said.
Welcoming the enhancement in Public Sector Development Programme (PSDP) for which the government has allocated Rs 202 billion for the next fiscal, he said it would definitely help improving the infrastructure and meeting the target of creation of one million jobs.
He also appreciated that the import duty on import of machinery had been reduced from 20 percent to 5 percent.
He welcomed the cut in sales tax on machinery being manufactured locally and said the decision would help further industrialisation and BMR activity in the existing industrial units.
About agriculture sector he said mark-up rate on agricultural loans must be five to six percent instead of nine percent. However, he appreciated reduction in prices of phosphate fertilisers and incentives for tractor industry.
"We have to learn a lot from India in this regard, which is having three crops in a year."
He lauded the abolition of further tax and CED on juices, paint Varnish and other items. He added that the income tax limit for salaried persons should be further enhanced.
He stated that uniform rate of 15 percent sales tax would not make any difference. He suggested a committee to check the issue of under invoicing and smuggling.
The LCCI Vice-President, Shahzad Ali Malik praised the five-year tax incentives on setting up of vocational training institutes. This decision would be helpful in producing skilled manpower for the industry.
He said that all the steps announced in this budget would have a trickle down effect and benefit general public. He asked the investors to come forward and play their due role by accelerating business and industrial activities.
Convenor LCCI Standing Committee on Customs, Tariff and Valuation, Irfan Qaiser congratulated the Federal finance minister for what he said presenting a 'business friendly budget.' He said that relief announced in this budget was never given earlier.
He hailed cut in duties on 465 items from 20 to 10 percent, which would result in cheaper finished products. He also welcomed announcement of having a uniform rate of sales tax and abolition of further tax that would enhance the profitability as well as cash flow.
He also praised the government for slashing duties on import of automobiles and hoped that it would resolve the premium problem, while consumer would also have a choice to purchase any brand.
Another LCCI member and auto-parts manufacturer, Tahir Javed Malik, hailed the government for not allowing import of second hand automobiles. He said that Pakistan already had many vending industrial units and the government backing would help them to grow further. He also welcomed 58 paisa per unit reduction in electricity tariff for industrial consumer and 40 percent deletion programme for the new tractor manufacturing units.
Chairman All Pakistan Plastic Importers & Traders Association and LCCI Executive Committee member, Mubashar Sheikh said it was a good budget but reduction in electricity prices was insufficient both for domestic and industrial consumers. However, he welcomed reduction of duties from 20 percent to 10 percent on import of plastic materials besides reduction in General Sales Tax and said that it would help in producing cheaper plastic items for consumers.
All Pakistan Cottage Industry and Small Traders Association Chairman, Ghulam Sarwar Malik said government should extend maximum incentives to cottage industry, as he was seeing nothing for cottage units in post-WTO regime in prevailing situation. He demanded that the government should establish 'Cottage Industrial Estates' on the pattern of small industrial states with five-year tax holiday.
He said that relief of 10 paisa per unit given to domestic consumers of electricity was a joke. He said that enhancement in turn over tax limit from Rs 500,000 to Rs 5.0 million was a plus point, which would enhance business activities.