Karachi
President Karachi Chamber of Commerce & Industry (KCCI) Agha Shahab Ahmed Khan, while emphasizing the need to consider out of the box solutions, urged the government to formulate an across-the-board incentive package encompassing all the sectors of trade and industry in order to stimulate the economy so as to minimize the impact of global recession and prevent massive unemployment in Pakistan.
In a letter sent to Prime Minister Imran Khan, Agha Shahab gave numerous recommendations for the proposed across-the-board incentive package in which General Sales Tax (GST) rates should be reduced from 17 percent to 9 percent while Withholding Tax (WHT) on all supplies by manufacturers and traders must also be brought down from the current 4.5 percent to 2 percent and the anomaly in WHT rates on import of raw materials by industry and commercial importers has to be removed and a uniform rate of With-Holding Tax should be applicable on both to support the Small & Medium Enterprises (SMEs).
He said that most importantly the discretionary powers under Section 140 of Income Tax Ordinance to access the bank accounts of registered persons be withdrawn, in order to restore confidence of investors and encourage transactions through banking system.
He recommended that the policy rate has to be reduced to 7 percent in line with other countries to stimulate the economy whereas the deferred import bills which are due for payment through banks should be refinanced at 5 percent mark-up.
President KCCI also recommended no questions should be asked for all investments in capital goods, raw materials, premises, acquisition of land and building for industry and trade up to 30th June 2022.
He noted that many other countries have taken initiatives to support their economies and announced incentive packages worth trillions of dollars to bail out the businesses which are going to suffer due to o recession triggered by COVID-19 pandemic.
“Even the Bangladeshi government has announced an across the board relief package of $8.6 billion which includes significant support to SMEs.”
