The Lahore Chamber of Commerce and Industry (LCCI) on Tuesday stressed the need for revamping taxation system as it has failed to yield desired results. LCCI President Sheikh Muhammad Arshad said that economic growth could be achieved by reducing rate and number of taxes. The business community is in deep trouble due to so many irritants including smuggling, under invoicing, non-professional attitude of the Federal Board of Revenue, undue notices and other taxation issues. If situation remains the same, it will cause irreparable loss to the industrial sector, he added.
He urged the parliamentarians to align the fundamental framework of the federal budget 2016-17 according to the economic challenges and to enable trade and industrial sector defy with the competitors at global level. The reins of economy are in the hands of parliamentarians as the federal budget 2016-17 is under debate in the National Assembly and they can suggest corrective measures, the President added.
He said that private sector has the ability and capacity to bring the country at par with developed nations of the world. The business community would not be able to make inroads if their genuine reservations about the federal budget 2016-17 are not addressed. The government should share its plan with the business community that how huge budgetary deficit would be met, he added.
He said that huge borrowing had already occurred massive loss to the economy as huge amount is being spent on debt servicing. If government borrows more to overcome budget deficit, it would add to the economic worries of the country, he opined. He said that withholding tax on banking transactions, bank accounts attachment, misuse of discretionary powers of the FBR officials and smuggling are the burning issues being faced by the business community.
The LCCI President said that business community was expecting measures in this regard but no clear announcements have been made in this regard. These issues are not only hampering the growth of business sector but also keeping people away from the tax net, he said, adding that parliamentarians should bring these issues under discussion particularly and remove these hitches which are coming in the way of smooth running of the businesses.
Sheikh Muhammad Arshad said the net worth of foreign direct investment in Pakistan is too low. In 2014, it stood at US $1700 million but in 2015 it contracted to $852 million. The Pakistan exports remained stagnant at $25 billion for almost three years. Because of below the target exports and huge imports trade deficit will further increase which will put extra pressure on already negative balance of payments. It will only lead to deficit financing and more loans that are not in the favour of economy at all, he added.
The LCCI chief hoped that all aspects of the budget would come under discussion in the National Assembly and corrective measures would be taken in the larger interest of the trade, industry and economy.