Zubair Tufail, President Federation Pakistan Chamber of Commerce and Industry (FPCCI) Saturday expressed satisfaction over the proposed budget 2017-18 and urged for reduction in corporate tax to attract the foreign investors. Addressing a press conference at Federation House, he said that the present tax rate of corporate sector is not in favour of foreign investors, therefore there is need to review the corporate tax rate to attract more foreign investment in the country.
He said that cost of doing business is still higher in Pakistan compared to regional competitors like India, Bangladesh and Sri Lanka mainly due to higher energy cost. The higher cost of production is major reason of lower exports, he added. "In order to support the industrial sector and enhance exports, there is need to fix the electricity rate less than Rs 9 per unit for the industries", he demanded. He said that payment of refund was a major issue of the exporters and finance minister Ishaq Dar has discussed the issues in detail in its budget speech. Finance Minister has assured to pay refunds in two phases and assure to pay all refund claims by August 15, 2017. This is a positive announcement and we hope the minister will fulfill its commitment to facilitate the exporters, he added.
Tufail said that on a positive note the federal government has proposed to increase tax on nonessential 565 products by present 5 percent to 15 percent. He said that reduction in sales tax from 17 percent to 7 percent on poultry Industry will help to promote the domestic poultry sector. He also appreciated the reduction of custom duty on fabrics for Pharma industry from 16 percent to 5 percent and continuity of textile machinery import on zero percent sales tax and import duty.
Agriculture sector is major contributor in the country's economy, therefore the government has also focused the agricultural sector and several incentives have been announced to reduce their cost of production. The government has announced to provide Rs 1 trillion loan to the farmers during next fiscal year, while imported urea will be provided at Rs 1000 per bag down from Rs 1,400 per bag, he informed.
He said that government has also announced to provide some relief to the leather industry by granting exemption of 3 percent custom duty on raw skin and hides. Some measurers have also been announced for rice sector to increase exports. Tufail urged the government to stop the issuance of notices to the tax payers and should develop a policy to widen the tax base.