Home / Chambers of Commerce / FPCCI identifies some harsh measures of Finance Bill and urges Finance Minister to make budget business friendly

FPCCI identifies some harsh measures of Finance Bill and urges Finance Minister to make budget business friendly

Karachi, June 09, 2017 (PPI-OT):“Although the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) does not believe in strike / shutdown of business premises however, it may take extreme action in case if its set of vital demands is not accepted before passing of the Finance Bill from the National Assembly”. This was stated by Mr. Zubair F. Tufail, President, while addressing a press conference at Federation House Karachi.

The FPCCI President elaborated that after a series of meetings and consultation with its Member Trade Bodies throughout the country, had identified eleven (11) harsh and irritant measures of the Finance Bill and proposals thereon has already been forwarded to the Prime Minister of Pakistan, Mian Muhammad Nawaz Sharif and Finance Minister, Senator Muhammad Ishaq Dar for their amicable resolution before it is passed by the Parliament, likely on June 14, 2017.

The FPCCI Chief disclosed that the entire business community of the country including Pakistan Business Council (PBC), Overseas Investors’ Chamber of Commerce and Industry (OICCI); American Business Council; All Pakistan Textile Mills Association (APTMA) etc., have also rejected the Finance Bill 2017 and urged the government to remove the harsh and irritant measures from it.

Zubair F. Tufail, President FPCCI said that the Finance Bill has totally disappointed the entire business community and lamented that it was prepared by the Federal Board of Revenue (FBR) considering only interest of the revenue collection by ignoring the private sectors’ aspiration for creating an enabling atmosphere for the promotion of trade and industrial activities.

Referring to the Federal Finance Minister Senator Muhammad Ishaq Dar Budget Speech, the FPCCI President urged him to honour his promise of paying all pending Income Tax and Sales Tax Refunds and the Refund Payment Order (RPOs) issued till April 30, 2017 should be released / paid before August 14, 2017, as exporters were facing severe cash flow crunch due to stuck-up of their refund claims with the FBR which forced them to shut various production units.

The FPCCI President said one of the harsh measures announced in the budget was increase in turnover tax. He informed that the rate of turnover tax was 0.5 percent but the government gradually has increased it to 1.25%. The business community strongly reacted to this increase because this tax was paid by those units, which had already posted annual losses.

FPCCI president said electricity and gas tariff for the export sector were high as compared with the regional markets, making local products uncompetitive in the international markets. The FPCCI demanded 25 percent reduction in tariff of electricity and gas with immediate effect.

The FPCCI lamented to the continuation of Super Tax on corporate sector and high net-worth individuals, and said it should not be implemented in tax year 2018. Tufail said super tax was introduced in tax year 2016 to generate funds for operation Zarb-e-Azb against terrorist activities in the country. However, in the Finance Bill 2017 it was proposed to continue for third consecutive year. He said foreign companies had planned their investment, but such taxes had demoralized them. He said the FPCCI rejected the continuation of super tax.

The President of FPCCI said that the business community also rejected two percent further tax on sales to unregistered persons as It is a burden on registered persons as unregistered persons are not paying and registered persons spend billions of rupees on purchase of flying invoices. He disclosed that although the Chairman FBR in the meeting of National Assembly Standing Committee on Finance had agreed that the present large spread of withholding tax between commercial and industrial importers of raw material would be narrowed in the Finance Bill but did not keep his words.

The FPCCI President also said commercial importers should be exempted from Sales Tax and Income Tax audits, as they pay 17% sales tax plus 3% value addition tax and 6% income tax in advance at port stage. A 10% tax to be levied on undistributed after tax profits must be withdrawn. It is also a unanimous demand of the FPCCI, Pakistan Business Council, The OICCI and the American Business Council, he informed.

The FPCCI president urged the government to continue with the Fixed Tax regime for builders and developers in the next fiscal year, instead of the proposed normal tax regime for this sector in Finance Bill 2017. Regarding raids on taxpayers’ premises, he said that FBR officers should not raid on any taxpayers’ premises, unless 15 days notice was issued for the payment or a reply by the taxpayer was received by the FBR. “If FBR was not satisfied with the reply, action may be taken but after informing the concerned trade association or chamber,” the FPCCI president demanded.

He also sought suspension of Circular No.14 of October 6, 2011 allowing income tax exemption on making sales to affected areas of Khyber Pakhtunkhwa. S.M. Muneer, leader of the business community and former chief executive of Trade Development Authority of Pakistan (TDAP) said the country had no priority for exports. Due to several difficulties Faisalabad -the hub of textile industry – has become a graveyard of industries, he added. He said all the business associations had rejected the budget, and if the government did not accept the demands, then the FPCCI would have no choice other than supporting the stakeholders’ in their anti-government decision.

For more information, contact:
Secretary General
Federation of Pakistan Chambers of Commerce and Industry (FPCCI)
B-1, Federation House, Main Clifton Road,
Shahra-e-Firdousi,
Karachi-75600, Pakistan
Tel: +92-21-35873691, 93-94
Fax: +92-21-35874332
Email: info@fpcci.com.pk
URL: www.fpcci.com.pk

Comments are closed.

Scroll To Top