The Lahore Chamber of Commerce & Industry on Saturday stressed the government to sign a charter of the economy to boost the economical activities in the country. This was expressed by LCCI officer bearers while presenting their proposals for Federal Budget 2022-23, in a press conference in Lahore.
LCCI chief Mian Nauman Kabir presented the budget proposals while senior vice president Mian Rehman Aziz Chan and vice president Haris Ateeq also spoke on the occasion.
Kabir said that the private sector is the engine of growth and its proposals must be the part of federal budget 2022-23. He said that in developing countries, the private sector generates 90% of jobs, funds 60% of all investments and provides more than 80% of government revenues. In this regard, feedback from the private sector plays a fundamental role in formulating appropriate policies for the trade, industry and economy. The robust linkage between the Government and private sector boosts the economy, creates a friendly environment, generates employment, attracts investment and helps in the growth of the SME sector.
“All the political parties should sign a charter of the economy and follow a single economic policy that should be evolved in consultation with the stakeholders”, the LCCI President said, adding that being the premier chamber of the country, the Lahore Chamber of Commerce & Industry has formed a set of proposals for the federal budget 2022-23, which is a composition of the issues being faced by the business community and recommendations for their best possible solution.
Mian Nauman said that Pakistan’s tax base is narrow. Out of a total population of 220 million only around 3 million people are filing their income tax returns. It is proposed that all the persons having industrial or commercial electricity or gas connections should be brought into the tax net. Similarly, all the person borne on the income tax roll, if liable to be registered under Sales Tax Act 1990, should also be registered for the purposes of sales tax. A broad base will increase the revenue and help in reducing the burden on the existing taxpayers.
The LCCI president said that to remove uncertainty among businesses and for sustainable growth, there should be consistency in economic policies (both macroeconomic and sector-specific). For example, taxation through mini budgets and changes through SROs negate the consistency & predictability of policies, which hurt the investment, exports, manufacturing, business community as well as end consumers.
He said that SMEs are the backbone of the industry. There are up to 5.2 million SMEs in Pakistan with a 25% share in exports and 30% contribution to GDP. Considering the vital role of SMEs, it is proposed that the turnover threshold for the definition of SMEs may be enhanced to eight hundred million rupees net of sales tax, FED and discounts.
Mian Nauman said regarding tier 1 retailers, it is proposed that condition of area specification may be removed, declared one shop retailer exempt from POS integration and consumption of electricity units may be used as a parameter instead of the cost of electricity. Further, for retailers operating in air-conditioned malls, plazas or centres, an area of 500 square feet or more may be specified.
He said that customs tariff rationalization is the need of the hour. To protect and promote local industry and for import substitution custom duties on the import of raw material may be reduced to a minimum or zero per cent. Similarly, the import of finished products and luxury goods may be discouraged through a levy or enhancing the regulatory duties.