LAHORE- The business community on Tuesday termed the Federal Budget 2014-15 energy and infrastructure focused with ambitious tax collection plan and far reaching for the industrial community, however being some skeptical on its implementation especially introduction of taxes at retail stage.

Addressing Press conference soon after the budget speech of the Federal Finance Minister Ishaq Dar, the LCCI President Engineer Sohail Lashari who was flanked by his Senior Vice President Mian Tariq Misbah and Vice President Kashif Anwar, said that a number of LCCI proposals have been incorporated in the budget document.

AKD chairman Aqeel Karim Dedhi, appreciating the decision of cut in capital gains tax, said that stock market has been star performer of Pakistani economy during the FY 2013-14. The rate of capital gains tax which was to increase from 10pc to 17.5pc from 1st July 2014, was reduced to ensure continued stability in the stock market and credit goes to the government. The budget proposed that from 1st July 2014 CGT rates shall be 12.5pc for securities held up to 12 months and 10pc for securities held for a period which is between 12 to 24 months.

Aqeel Karim said that in the previous year, growth in agriculture sector was not very encouraging therefore, the incentives announced in the Federal Budget 2014-15 would give required boost to agri-economy. Increase in budget for higher education and health sectors is a laudable step that would give a big relief to the masses.

APTMA former chairman Gohar Ejaz termed Federal budget 2014-15 as growth-oriented pro-textile industry budget, saying that the incentives and facilities offered in the budget will contribute to the GDP growth of the country.

APTMA former chairman said the Federal Finance Minister has himself admitted that an improved availability of electricity and gas to the textile industry has resulted into 4.1pc growth in GDP. Textile industry will have to be exempted from electricity and gas load shedding to realise its real potential ahead, Gohar stressed.

Pakistan Railways Prem Union Senior Vice President Sheikh Mohammad Anwar, while talking to media men, termed the federal budget as disappointed and warned that this would create further frustration among working class. He further said that a meagre 10 per cent increase in salaries is a joke with government employees.

All Pakistan Business Forum founding Chairman Syed Nabeel Hashmi appreciated the Federal budget terming it as a dynamic, revolutionary and far reaching for the industrial community. “It seems to be well calculated and hopes its good effects shall translate into jobs and revenue creation.” However, he was skeptical of its implementation especially introduction of taxes at retail stage. “We welcome reduction of sales tax on tractors and increase of taxes on the non-registered informal sector. Reduction of FED on large vehicles shall support local production.

APCMA former Chairman Aizaz Mansoor Sheikh appreciated the government for decrease in corporate tax and bringing untaxed sectors into tax net. In order to attract Foreign Direct Investment in manufacturing, construction and housing sectors, the govt proposed that corporate tax rate be reduced to 20pc. This will also generate employment, which is one of our major challenges, he added.

Pakistan Steel Melters Association chairman Mian Saeed has said that several issues have not been clear yet however according to budget speech, the enhancement in sales tax from Rs4 per unit to Rs7 per unit on electricity bills and raise in withholding tax will increase cost of steel used in construction by Rs3720 per ton while rate of billets will be escalated by Rs3200 per ton, leading to sharp rise in construction cost, as steel is the major part of construction material.

He informed that the FBR has consulted the industry before taking decision of improvement in tax on steel manufacturing.

Pakistan Agricultural Scientists Association (PASA) President Jamshed Iqbal Cheema said that budget is very funny for agri sector as the government has announced some relaxations for tunnel farming which is very limited. He said that only 35,000 acres of land is being cultivated through tunnel farming out of over 50 million agricultural land. The government instead of facilitating traditional farmers by announcing some subsidy or cut in tax on seeds, pesticides, fertilizers, water or agri tubewells, has announced relief for tunnel farming which is almost useless.

Pakistan Dairy Association senior vice chairman Faisal Hussain Malik appreciated the govt for keeping the dairy sector in zero rating regime and accepting the proposal of the PDA.

Further, regarding broadening of tax net, he said that the government has made a conscious policy decision to enhance the contribution of direct taxes, which are progressive taxes, and gradually reduce the burden of indirect taxes, which affect the common man.

The Federal Revenue Alliance Employees Union has termed the federal budget 2013-14 as an inflationary, as just 10 per cent pay raise has been announced with more taxes on salaried class which will not only diminish their purchasing power but also escalate inflation.

FBR Union president Mian Abdul Qayyum, registering his resentment said that no wealth tax has been announced while direct tax on agriculture income has been once again ignored which is not right, as all sectors of society need to be in the tax net without any exclusion. He said that no roadmap has been announced to provide relief in electricity loadshedding, which is a serious cause of concern for all.

He said that the opportunity of tax reform has not been availed by the new team and instead the government has resorted to old tactics of taxing the already taxed at higher rates. The last year increase in sales tax continued to impact the general public and salaried class negatively.

Suggesting the restructuring of Federal Board of Revenue and massive reforms in tax system, he said that FBR can retrieve the loss of revenue approximately in trillions after exemption of taxes on non-resident companies.

PAAPAM Chairman Usman Malik congratulated the Federal Finance Minister Ishaq Dar for presenting a business friendly budget and added that it shows that how meticulously he has prepared the budget to reflect the wishes of all segments of the society.

PAAPAM Chairman Usman Malik said that the reduction of sales tax to 10 percent will put the tractor industry and its allied vending units across the country back on track, bringing tractor rates in the reach of small land-holders - a step forward in farm mechanisation, maximising per acre yield, he added. He said that auto industry was facing a steep decline in production and hike in sales tax on tractors backfired, leading to closure of industry, he said.

Former Finance Minister Dr Salman Shah said that broadening of tax net is the only way to increase revenues because one of the cardinal principles of taxation is that it should be levied on the basis of ‘capacity to pay’ and it would therefore only be fair if all tax-related measures are implemented in consultation with the real stakeholders.

PML-N traders wing chairman Irfan Iqbal Sheikh said that federal government has presented best, people-friendly and balanced budget for next financial year in the difficult conditions which will open new avenues of development. He said that no burden has been put on common man in the budget rather increase of billions of rupees has been made in the amounts of welfare programmes for providing relief to the poor people.

All Pakistan Anjuman-e-Tajiran President Khalid Pervaiz cautioned the government that they should seriously resolve all budget-related issues, failing which the draconian measures of taxing the ‘already taxed’ for generating additional revenue would give a bad name to the government. 

Our Staff Reporter from Karachi adds:

The business community in country’s commercial hub have termed the budget 2014-15 as friendly and export oriented.

Businessmen in Karachi said that the government accepted fifty percent demands of the business community which was given in the budget proposals. Announcement of Karachi, Lahore Motorway and funds allocation for power projects are good sign for the economy.

Talking to The Nation, Abdullah Zaki, President Karachi Chamber of Commerce and Industry, said government abolished the income support and brought the custom tariff to 25% on import items which is good for the economy.

“We expect further decrease in the custom tariff that would control the Afghan transit trade and would increase level of revenue,” he said.

Government acknowledged fifty percent suggestions and the issues heighted in the budget document, which was compiled by the business chambers of the country including KCCI, he added.

This budget is export oriented where lots of initiatives have been taken for the betterment of economy, said Zubair Motiwala, former president KCCI, while talking The Nation. 

Zubair Tufail, member Federation of Pakistan Chambers of Commerce and Industry told The Nation that a very good thing in this budget is that government didn’t give any additional burden to any sector.