The Budget should be revised in consultation with business community: President FPCCI addresses letter to PM

0
56

“The proposed budget is full of anomalies and contradictions: so it should be revised in consultation with the business community before being finalized and approved.” Mian Nasser Hyatt Maggo President, Federation of Pakistan Chambers of Commerce & Industry (FPCCl) requested in his letter dated 23 June 2021 addressed to Prime Minister Imran Khan.

Maggo stated FPCCI firmly believes that current budget, proposed and manipulated by FBR, is strictly conventional in nature and does not provide relief to businesses and does not promote economic growth. Various industries and sectors are compelled to spend millions of their hard-earned funds to advertise in print media and make their voice heard.

FPCCI strongly recommends that Tax Policy Unit under Ministry of Finance & Revenue should formulate the taxation system in the budget not FBR. Sectorial strengths, weaknesses, and needs should be properly analyzed before imposing any form of taxation by Tax Policy Unit, he said.

FPCCI demanded separation of tax judicial system from tax collecting machinery to make it comply with the constitution. This best-practice recommendation was also overlooked and FPCCI demands that this provision must be incorporated in the final draft of the budget. FPCCI is also concerned about non-withdrawal of CNIC condition on sale; which continues to hinder business and trade activities and growth within the country.

Mian Nasser Hyatt pointed out that breaking norms and traditions, President of FPCCI or his nominee has not been given chairmanship of the governmental budget anomalies and technical committee — and, the apex body has been completely ignored in the technical committee. Historically, FPCCI has always helped the government to finalize the budget through addressing most of the anomalies and contradictions.

The Federation chief reminded the Prime Minister that: “I wrote to you on anomalies and contradictions in the proposed Federal Budget 2021-22. I, as President of FPCCI, extend my whole-hearted support to you to help and assist the federal government to resolve the issues and anomalies mentioned above.”

He said that Finance Minister, Mr. Shaukat Tarin, must have lived up to his promise that budget 2021-22 will not be finalized without consulting FPCCI; the apex body representing trade, industry, and services in the private sector of Pakistan.

FPCCI is of the view that FBR is responsible for introducing anti-business and anti-growth income tax statutes in the Federal Budget 2021-22; through which they have sought to enhance their discretionary powers, e.g. Section 203A and Section 127 of ITO. Well before the budget in February 2021, FPCCI had proposed simplification of tax system and reduction in tax rates to the Honourable Prime Minister of Pakistan; on which he directed FBR to look into FPCCI’s recommendations. But, unfortunately, FPCCI’s recommendations on tax reforms were not incorporated in the budget.

Nasser Maggo suggested that the technical sub-committee must not comprise of currently practicing tax lawyers and consultants to rule out conflict of interest and ensure neutrality. The lame clarification being given by FBR on income tax statute on Section 127 is illogical and out of sound mind and FPCCI is of the view that the Finance Minister must not have given approval to issue such a clarification on Section 127. Section 127 is also in contradiction to the structure of the Constitution of Pakistan and defies Section 10A of the constitution blatantly.

He reiterated that FPCCI is looking forward to productive dialogue and discussion to eliminate anomalies before the budget is finalized and approved. Copies of the letter are also addressed to Shaukat Tarin — Federal Minister for Finance & Revenue, Asad Umar — Federal Minister for Planning, Development, and Reforms, Hammad Azhar — Federal Minister for Energy, Abdul Razak Dawood — Advisor to PM for Commerce and Investment and Asim Ahmad — Chairman FBR.