Shahryar Khan Baseer
To increase industrialization and improve tax collection from new businesses the Government needs to introduce a whole new set of regulations that are suited to the sectors that are targeted for development. For example the Silicon Valley in California USA is famous for launching Internet companies because of the many changes in regulations during 1990’s that attracted investors and developers to it. These regulations made it cheaper and easier to register a legal company in USA.
For Pakistan the changes needed should help establishment of companies easily, with minimum cost, without visit to any office or need to bribe any official, with minimum risk to individuals and with safety features for investors. For example to establish a company in Pakistan currently requires a lawyer and finance manager in the start and with yearly reporting requirements, which all add up costs to the product. And these costs can render the product uneconomical. Therefore the new regulations should have a central registration with standard documentation for everyone. The central registration should also give automatic tax registration and provide a certificate of registration with reference number searchable on a website. The website can also highlight owners, audited reports or other details. Certificates of registration can be used to open company bank account and register with trade bodies, importers or other organizations.
There should be option to register with a company address or without any address. As many enterprenuers and IT companies don’t need an office and associated costs. Post offices should also provide Postbox addresses to be used for correspondence with non address companies. The companies should be provided yearly tax and finance consultants at standard low fixed rates through third parties that are screened and registered by Central Registration Office, who also assigns them to customers requesting these services. While also providing offices, facilities and standard training to them. All of these services should be provided online or through phone calls.
New rules for investors in such companies should also be framed where the Rights and Risks for the investor is easily highlighted. Standard contracts for silent partners should also be introduced. The regulations should reduce risk for individuals against litigations, while it should allow company directors to list company or personal properties they want to include in company assets that would be sold to repay company debts or invested amounts in case of company ending for any reason.
Silent investors should be allowed to conduct secret audits and risk analysis on their own costs through Central Registration Office. The regulations should also provide path for good companies to list on Stock Market for expansion funds. These regulations would allow all new companies to be registered centrally, without visit to any Government office. It will ensure every company pays taxes from start of business. It will increase entrepreneurs and IT companies, while providing true one-window facility for many services. It will allow the local investors to invest with Entrepreneurs and product developers.
The Central Registration Office will also generate hundreds of jobs, therefore, the Government should consider setting up this office in impoverished province while being under Federal control to create steady flow of jobs and economic activities in that region.
—The writer is freelance columnist, based in Peshawar.
