President Islamabad Chamber of Commerce & Industry (ICCI) Muhammad Ahmed Waheed has said that the Budget 2020-21 has not accommodated major demands put forth by trade bodies of the country to facilitate the growth of business activities and revive the economy and should be revised to address the key issues of business community.
The ICCI President said that corporate tax was to be reduced by 1% each to bring it down to 25% by 2023 from its current level of 29%, but unfortunately no reduction was made in corporate tax this year and stressed that government should reduce this tax to promote investment and businesses.
He said that keeping in view the cost of steel, 1.5% turnover tax on steel industry was putting more burden on this important industry and urged that government should bring it down to 0.5 percent that would also facilitate the growth of construction activities.
Muhammad Ahmed Waheed stressed that government should abolish the difference between input and output tax by allowing adjustment of input tax up to 100 percent of output tax instead of current 90 percent. He said that introduction of CNIC condition has led to great shrinkage in business activities. Therefore, keeping in view the difficulties of business class due to Covid-19 pandemic, government should defer CNIC condition for another one year. He said that high tax on rental income which was promoting tax evasion and urged that government should reduce it to promote tax culture and broaden tax base. He said that in light of problems created by Covid-19, government should waive off all audit cases for one year. He strongly opposed the introduction of luxury tax in Islamabad, which was totally unjustified.
The ICCI President said that reducing custom duties and regulatory duties on many items in budget was a good move, however bringing commercial importers and industrialists at same level by reducing income tax from over 5% to 2% would not be helpful for industrialization and should be reconsidered. He said that promoting exports should be the top priority of government for reviving the economy, but unfortunately no relief was provided to export-oriented industry in the budget. He emphasized the government should cut electricity and gas tariff for industry and exporters to generate more economic activities and boost exports.
