ISLAMABAD, April 16: Business community Tuesday proposed various measures for inclusion in the next budget by the government to improve ease of doing business, enhance tax revenues and boost economic growth in the country.
The proposals were made during a meeting of National Assembly Standing Committee on Finance, Revenues, and Economic Affairs held here under the Chairmanship of Faiz Ullah.
Presenting a joint proposal for federal budget 2019-20 by All Pakistan Chambers of Commerce and Industry, Kamal Amjad Mian from Lahore Chamber of Commerce and Industry said the number of taxes must be reduced to five by clubbing labour related taxes such as EOBI, PESSI, WPPI, WWF, professional and property tax, and federal and provincial sales tax.
The proposed five taxes include corporate tax, labour tax, vehicle tax, and sales tax.
Meanwhile presenting the proposals to the committee, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Engineer Daroo Khan said the government should make a comprehensive policy to encourage the people to establish industries in the country.
The government, he said should announce tax exemptions for 10 years to those who build their industrial units within a time period of three years.
He said industrialization would not only help increase in employment opportunities but also will generate more revenues for the government through sales tax.
The government should expand the tax net by documenting the economy and retailers, and small shopkeepers must be brought into tax net but rate of tax on them should not be more than 1%.
Industrial units should get a cheaper electricity to make them more competitive.
Further, he saqid if the government wants to bring the value of land near to the market value, it must reduce tax rate on the property.
The FPCCI demanded that the sales tax should immediately be reduced from current 17% to 15% while it should be further reduced by cutting down by 1% annually.
Corporate sector is heavily taxed at the rate of 29% which is too high and should be cut down to 25%, he added.
Personal income tax of 20% is also too high and must be reduced.
The FPCCI proposed that professionals such as doctors, and lawyers must be taxed as most of them are not documented despite earning a huge money.
Daroo Khan said custom duty on plant and machinery should be cut to zero.
He also suggested to establish large export houses on all bordering points with the neighboring countries to boost the bilateral trade ties with them.
Representatives from Sialkot Chamber of Commerce and Industry explained why the exports from the country could not witness a substantial increase despite devaluation of the Pakistani rupee.
He said due to devaluation, the input cost has increased adding duty on import of such inputs must be reduced to zero to increase the volume of country's exports.
Further he said the government should give subsidy on the solar power equipment by 20-25% to enable the industrialists to establish their own electricity panels to produce cheaper electricity.
Member of the committee Dr Aisha Ghaus Pasha said all the proposals should be considered seriously and asked the committee chairman to get feedback on these proposals from other stakeholders.
Senior vice president Pakistan Afghanistan Chamber of Commerce and Industry Haji Jamaludin stressed the need to enhance trade ties with the neighboring countries specially Afghanistan and Iran.
The Federal Board of Revenue official assured all the chambers of commerce that the Board would consider all their proposals while preparing the upcoming budget.
He said the government was taking measures to curb issues of smuggling and under invoicing.
He asked the chambers to cooperate with the government in this regard.
He also urged them to give some suggestions about increasing tax revenues and also help the government in identifying venders, and retailers to bring them to the tax net.