The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) called a press conference to apprise the press and media about the proposals of Federal Budget 2019-20 at Federation House Karachi. Engr. Daroo Khan Achazai, President FPCCI regretted that as per past practice the Government did not undertake the consultative sessions with FPCCI regarding the upcoming Federal Budget 2019-20.
This practice was useful and effective measure for coming up with budgetary proposals based on input from the real stakeholders. However, FPCCI has done its homework.
While discussing the current economic situation, Engr. Daroo Khan Achakzai President FPCCI showed his serious concern over the rising policy rate, increase in petroleum product prices, decline in foreign investment, devaluation of Pakistan Rupees etc.
He stated that government is presently facing shortage of tax revenue and projected that economic growth rate may be declined to 3.7 percent which may enhance unemployment rate and poverty in Pakistan. He informed that as per practice, FPCCI formulated Budgetary Advisory Council who prepared Federal Budget Proposals with the consultation of members’ trade bodies.
The objectives of FPCCI Budget proposals are revamping taxation system, documentation of economy, employment generation through Industrialization, Promoting a responsive and equitable taxation system, infrastructure development and trickledown effect of the fiscal space to the grass root level.
Engr. Daroo Khan Achakzai added that government should announce one time another amnesty scheme which should allow the stakeholders to declare their domestic and foreign assets at minimum rates. The Government should also ensure that after declaration of assets under amnesty scheme the Federal Board of Revenue (FBR) will neither ask about the source of income nor they will conduct any audit or inquiry.
Moreover, FPCCI proposed to reduce sales tax rate gradually from current 17 percent to single digit, to abolish all duty and taxes on the imports of all machinery, to reduce further tax on unregistered person from three percent to one percent and imposition of taxes on final goods.
He also suggested establishment for export warehouses at border for enhancement of trade with neighboring countries and bringing the agriculture and service sectors into tax net proportionately. He also proposed to increase the education and health budget for improving human capital in Pakistan.
Zubair Tufail, Chairman FPCCI Advisory Committee on Federal Budget and Former President FPCCI also emphasized on the early issuance of promissory notes and clearance of all refunds including income tax and DLTL etc. He suggested that government should use the data of domestic and international travellers for identifying potential tax payers and bringing them into tax net.
He underlined the need of promotion of SMEs culture in Pakistan and suggested that the government should formulate mechanism for monitoring consumer goods prices. While discussing China Pakistan FTA, he proposed that China should give additional market access to agriculture products of Pakistan.
He also recommended imposition of transit trade fee on Chinese trucks as per international practices under CPEC. He also requested the government to stop harassment of business community by NAB and FBR in order to improve business climate of Pakistan.
Dr. Mirza Ikhtair Baig, Sr. Vice President FPCCI highlighted the deterioration of law and order situation of Karachi and said that it would discourage investment and other economic activities. He further stated that the contractionary monetary policy has failed to curb inflation and stabilize the economic growth in Pakistan.
He also suggested to reduce tax on rental income and suspension of regressive powers of FBR to raid and harassment without notices. He also requested the government to take FPCCI on board in finalization of agreement with IMF and highlights IMF conditionalities publicly