Federal government after the criticism from various corners has decided to rename the pressure builder mini budget as “Economic Reform Package”, Source confirmed. The ingredients of the half a budget would be the same as prepared. On the advice of Finance minister Asad Umar, Ministry of Finance (MoF) has queued various steps to be finalized in three working days.
Government also intends to present a 5-year economic plan. Around 200 tariff lines are under consideration to cut short the imports of least necessary items.
Source from the finance ministry said that the government has taken a few and proactive steps to uplift the economy without the consent of stakeholders.
The measures would be announced during the “Economic Reform Package” speech.
Bitter and sweet ingredients of Economic Reform Package
The government since came into the power was unable to take measures which have been directly and positively transmitted to the masses, but the government has claimed that the better impact of the country’s economic transformation could be seen after five years or so.
Following steps are expected in the Economic Reform Package to be presented on January 23.
Eliminate 0.02% advance tax on sale and purchase of shares
Listing of China- Pakistan Economic Corridor (CPEC) infrastructure projects on trading platform of Pakistan Stock Exchange (PSX)
Bringing CGT on equities at par with the real estate sector
Carrying forward capital losses for up to 3 years
Increase GST from 17% to 18%
Phase out Super-tax earlier than previously planned
Rationalize taxation of holding companies on inter-corporate dividend
Reduce duties on imported raw material
Increase Additionally Customs Duty (ACD) from 2% to 3%
Intensification of duty on imported 1,600cc and above vehicles
Duty on imported tyres (suggested 4-10 percent)
Import of used tractors (up to five years-old and the engine CC to be decided)
For the purpose to promote banking channel the reduction of withholding tax on cash transactions for non-filers
On Cement sector Increase FED (1.5-3 percent)
Increase duty on imported tiles
In the fertilizer sector, sales tax to standard (16%)
In the Economic Reform Package, food sector Federal Excise duty likely to be raised specially on beverages.
Standardize sales tax on petroleum products to current level of 17%
Increase duty on imported paper
Government to announce Issuing bonds for the tax refunds
Imported yarn duty Intensification
Smokers likely to be affected, government to announce FED on sale of cigarette
Furthermore, source from the finance ministry reviled that the foreign investment companies have expressed displeasure on FBR’s performance.
Foreign companies mentioned that they have to face difficulties in export zones even after the NTN facility.
It is pertinent to mention here that the Finance Minister Asad Omar said during his visit of Karachi, the revolutionary measures are being taken for the Ease of Doing Business (EoDB) in the mini budget turned ‘Economic Reform Package’ which is to be presented on January 23.
In this context, foreign companies are also expected a new module of tax facility and simpler procedures for promoting investment in Pakistan.