Opposing the 17 percent sales, 2.5% special excise duty,15 % flood surcharge and two percent increase in power tariff,Textile Sizing Industry Multan & Faisalabad observed complete strike, on the call of All Pakistan Textile Sizing Industry, They have begun strike against imposition of Sales Tax resulting supply of raw material to Power Looms is halted, It is reported on Sunday.
It is pertinent to mention here that the government had exempted Textile Industry from sales tax in 2007, but it is again imposed since March 16, 2011 as a result textile industry would pay 17 percent tax.Due to this strike, supply of raw material to power looms is halted. Power looms industry owners have also shut their industries in support the strike.Daily wages employees are facing severe problems owing to halt of production in the industries.
Taxpayers yet felt insecure because of complications in the current taxation policy and lack of trust in the present tax system," President MCCI Shahid Naseem Khokhar said in a press statement, here the other day.
He said that tax collectors should collect taxes and there should be no harassment. He anticipated that the country has a potential of increasing tax to GDP ratio by 3.5 percent for next five years through making the system, public friendly and equitable. Widening tax net will allow reduction in tax rates, without reducing revenue, he added.
Khokhar further said that the encouragement of tax culture could only take place through removal of corruption from the tax departments, which will encourage and mobilise new taxpayers who are hesitant to contribute and continue to remain outside the tax net. The MCCI president said that once people see the tangible benefits of the taxes paid, there would be a better response to tax compliance. Hence it is imperative for the government to revamp the perceptions of public by proving that their money is spent on them. Taxation has not been given proper attention in Pakistan, Shahid Khokhar said.
MULTAN,March 17th:The Multan Chamber of Commerce and Industry (MCCI) Thursday opposed imposition of one-time 15 percent surcharge on income tax payable during the financial year 2010-11.They opposed increase in Excise Duty and Sales Tax on all inputs including imports and withdrawal of 17 percent GST exemption on fertilisers, pesticides, tractors, leather, sports and surgical instruments. MCCI president Shahid Naseem Khokhar said it was very unfortunate that the government resorted to what they claimed was a ‘Mini budget’ at a time when the government was bridging the resource gap by printing new notes worth over Rs 2 billion daily.As the incomes are stagnant or declining since the last three years and the average increase in energy tariffs has been very high, even one or two percent increase in taxes would create a dooms day scenario, he added.He said the decision would give a bad name to the government as the prices of a number of items, including clothes, shoes, fertilizers, sports goods and tractors would be going up in coming days.MCCI President said that the decision would bring a tsunami of inflation that would be entering into a new phenomenon. He said that it was very unfortunate that the “Mini budget” was announced at a time when the government was bridging the resource gap by printing new notes worth over Rs 2 billion daily.
“As the incomes are stagnant or declining since the last three years and the average increase in energy tariffs has been very high, even one or two per cent increase in taxes would create a Dooms Day scenario.”.
The business community and economic experts, reacting to imposition of surcharge on income tax, raise in excise duty and withdrawal of GST exemption on agri inputs, have said the price-hike would further jump by 30 to 35 percent due to this anti-public decision.
The Customs Department has stopped the entry of all consignment at ports and demanding sales tax, as the items in Chapter 29, 34 and 39, which were earlier exempted from sales tax, have now been included in the tax net, traders said and added that after the sales tax imposition the income tax would also be levied on them.
The 18 percent sales tax has been imposed on zero-rated items while their income tax has been raised to 7 percent from 6, besides excise duty of 2.5 percent, which would lead to around 30 to 35 percent inflation for consumer goods, said Khawaja Khawar Rasheed, a business leader of the FPCCI. He said the government finally implemented the 15 percent flood surcharge on income of corporates and individuals initially for the remaining 3 month period of the current fiscal year.
Experts said the preliminary impressions suggest that the new tax would curb FY11 earnings growth by 1.5 percent to 19.5 percent from 21 percent earlier. On individual companies, this new taxation measure would erode profits on an average by 2 percent, they added. Umer Bin Ayaz, an economy expert, said the government has also withdrawn sales tax exemptions and implemented 2.5 percent special excise duty and has increased the applicable tax of sugar. All these measure are likely to generate additional tax revenue of Rs53b as per official estimates, along with planned expenditure cuts of around Rs67b.
Jamshaid Iqbal Cheema, an agri expert and Chairman Pakistan Agricultural Scientists Association said that govt had assured them to impose tax on agri income but instead of that it has imposed tax on agri inputs, which result into reduction in yielding of crop. He said when crop production is decreased by 10 percent then its price is jumped by 30 percent.
He said that the taxation on agriculture sector has always been negligible and the share of federal tax collection from agriculture sector has been only 0.12 percent of GDP in 2003-2004. He pointed out that the low share indicated that the entire value-added chain in the agriculture sector is nearly tax-exempted.Noted economist Dr Ashfaq Hassan Khan declared this step of the government as positive but said that it was too late, which reflected the inefficiency of the economic managers of the present government. He argued that although agriculture’s share in national income exceeds 23 percent, revenue raised from the sector is negligible. With limited tax potential of many subsistence farmers, the land revenue system needs to be replaced by agricultural income tax for any significant increase in revenues from this sector. Besides these additional revenue generation measures, the government also announced fiscal austerity measures which include: Petroleum entitlement, stationary and travelling allowances to be cut by 50 percent for the remaining part of the year. A complete freeze on purchase of durable goods and hiring of the human resource, have also been announced, he said.
He said that initial impressions suggest a negative to neutral impact on the stock market and an inflationary pressure from the macro view point. Nevertheless, in the medium to long-term he viewed these measures as positive for the economy.
The LCCI former president Aftab Vohra said that the trade bodies of the country have been proposing the imposition of the agricultural income tax for a long time. He said the industrial sector is paying huge amount of direct taxes whereas the big landlords are paying nothing. He siaed the fuedals who are paying nothing should be forced to pay income tax, sales tax and excise duty.
Muzzammil Aslam, an economist, observed that with these measures, the government is expected to contain the deficit by an incremental Rs120b, including Rs53b through taxes and Rs67b through curtailed expenditures. LCCI President Shahzad Ali Malik said that the decision would bring a tsunami of inflation that would be entering into a new phenomenon. He said that it was very unfortunate that the "Mini budget" was announced at a time when the government was bridging the resource gap by printing new notes worth over Rs 2 billion daily.
"As the incomes are stagnant or declining since the last three years and the average increase in energy tariffs has been very high, even one or two per cent increase in taxes would create a Dooms Day scenario."
Our staff reporters from Karachi and Hyderabad add: Pakistan Leather Garments Manufacturers and Exporters Association Chairman Fawad Ijaz Khan has said the recent hike in the excise duty, sales tax, power tariff and the imposition of surcharge on income tax will shoot up the cost of production of the leather garments sector.
In a statement, Chairman PLEGMEA stated that we should not have any objection on the levy of sales tax on local sales of finish items fall under five zero-rated sectors because the sales tax throughout the world is levied on local sales.
However, under the new presidential ordinance a supplier will not charge sales tax if he sells his products to manufacturers or exporters.
He stated that a large number of commercial importers and local raw material suppliers will now have to pay sales tax on the import of leather, chemicals and accessories of garments. Such importers/suppliers will charge sales tax on their sales.
Meanwhile, Sindh Chamber of Agriculture President Dr Syed Nadeem Qamar and other members have strongly condemned the imposition of taxes thorough Presidential Ordinance and demanded the government to withdraw the ordinance under which the taxes on income, imports, agriculture and domestic sales have been imposed by the government.
They observed that the move to withdraw the subsidy on agriculture inputs and engineering items through the Ordinance would adversely affect the agriculture sector.
The inputs and item including fertilizers, pesticides, tractors, plant machinery, equipments, implements and parts are essentially required for accelerated agriculture development, they said and added that the businessmen are applying all their efforts to exploit and they do not want to see the prosperity of agriculture, country and agriculture-friendly government for their own interests.
The business have already increased the rates of fertilizers with justification, they said and added that the withdrawal of subsidy will further slow down the agriculture development which needs to be accelerated to improve the economy of the country.
The agriculture sector has badly been damaged by floods and received overall loss of 50 percent, they said and urged that under present circumstances, the agriculture needs very wisely provision of incentives, but inappropriate, adverse and unfavourable policies such as withdrawal of subsidy will deteriorate the progress of agriculture sector and economy of the country.
Finance Minister Abdul Hafeez Sheikh has Wednesday said his ministry was anticipating export to cross twenty-four billion dollars during the current fiscal year, adding that more sectors will have to be brought under taxation for the betterment of the levy system, Geo News reported.
He was addressing a press conference here. He said the export has been estimated to reach over 24 billion dollars this year, hoping that crops export will surge this year owing to acute cut in production across the globe.
“Government faced loss of twenty billion dollars due to withdrawal of hike in POL prices some days ago,” he said. Inflation is directly linked to loans the government is seeking from central bank,” he underlined.
Multan,March 12th—Australian companies are interested in making investment in Pakistan’s agriculture sector from production of crops to their processing and export.
Regional business development manager of Australian Trade Commission Imran Saeed, in a meeting with Multan Chamber of Commerce and Industry’s (MCCI) acting president Mian Ata Tanweer Sheikh, said that Australia was already extending cooperation to Pakistan in different sectors and transferring skills. He disclosed that many Australian firms were ready to invest in Pakistan on crops production,including cotton, besides vegetables and fruit, their processing, preservation and export.
MCCI acting president said that Australian firms can benefit from investment in south Punjab by employing modern agriculture techniques. The land is fertile and supported by all the four seasons, said Mian Ata Tanweer Sheikh and added that investment by companies or partnership with local investors or agriculturists and agro-based industry would not only yield profits but would also help improve financial conditions of the farmers in southern Punjab.
The number of motorcycle assemblers has almost tripled in the country during the last 10 years as presently 72 registered companies are engaged in assembling of Chinese make of two- wheelers.
According to the statistics of Motorcycle Assemblers Association of Pakistan (MAAP), presently 72 registered private companies are involved in the manufacturing, importing and assembling of the two-wheelers in major cities of the country.
"Over a decade back the number of assemblers was dismal but after the ending of the deletion programme by the government, the number of assemblers has jumped significantly," said Sabir Shaikh, representative of the dealers and assemblers of motorcycles here on Thursday.
The existing customs duty on import of CBU (Completely Built Unit) of two-wheelers stands at 65 percent while that on CKD (Completely Knocked Down) kits is 15 percent.
Statistics further showed that during Jan-Dec 2010, the production of motorcycles stood at 1.5 million. It rose from 0.121 million in Jan, 2010 to 0.146 million in Dec, 2011.
The assembling companies are based in Karachi, Hyderabad, Gujranwala, Gujrat, Lahore and Hub (Balochistan).
"The cost of production in Karachi is too high as compared to that in the province of Balochistan, Punjab and even interior Sindh where cheap labour is available," said Sabir Shaikh.
At least 50,000 direct and 150,000 indirect labours are involved in this business.
"We can attract more business if the government announces uniformed duty for CKD and CBU kits," he pointed out.
The units are set up with an investment ranging from Rs30 to 40 million to a maximum depending on the real estate, labour and other miscellaneous cost.
"Presently we are facing tough competition because of the large number of assemblers of Chinese make motorcycles," said a Lahore based entrepreneur engaged in the motorcycle business.
Besides, the local market, assemblers are also catering to the demand of the Afghanis and Sri Lankans.
"Due to our cheap cost of production, we are exporting the motorcycles to Afghanistan and Sri Lanka," said the assembler and added unlike the past when only Japanese versions of motorcycles were on demand, the Chinese make are also popular nowadays.
The 70cc assembled and imported Chinese make are available at the range of Rs38,000/- to Rs41,000/- per unit while the Japanese make cost Rs65,000/- per unit in the local market.
"I would prefer the cheaply available Chinese motorcycles as compared to others which are very costly and the quality is almost the same as compared to fuel consumption and parts are concerned," said a customer, Ali Hussain, in the busy Akbar Market in Saddar.
The National Assembly Committee on Commerce Thursday was informed that Pakistan would plea the EU concession for 75 products with India at Foreign Secretaries level talks scheduled on 21st of this month.After 2010 devastating floods in Pakistan, the EU offered Pakistan unilateral concession over certain commodities, which still needs approval from World Trade Organization (WTO) and the EU Parliament. Secretary Commerce Zafar Mahmod informed the committee that the government at every forum actively pleaded the case. Even thePrime Minister and foreign minister sent letters to other countries seeking their support to get the concession from EU.Engineer Khurram Dastgir Khan, MNA/ Chairman Standing Committee on Commerce chaired the meeting. The secretary further told the committee that the EU provided several concessions to other countries in which some were still in progress under WTO rules and regulations. The EU announced special scheme for less developed countries (LDCs), and those who qualify could avail the concession from it. In this regard theUN organization has to consider the status of LDC for any country. Pakistan, India and China could not qualify for scheme because their population exceeds 50 million, which is pre-requisite for this concession of the EU, the committee was told. Before 2010 floods, Pakistan actively pleaded its case to get some concession from EU but was not successful.Secretary Commerce dismissed the idea that Pakistan did not properly advocate its case in WTO. “However there were other countries that wanted some incentives in reward for supporting Pakistan case in WTO,” he told.The committee was informed that the Pakistan has sent letters to India, Bangladesh, Sri Lanka, and Vietnam. The Committee expressed concerns that war on terror has caused massive damage to Pakistani exports—and as a result; WTO trade regimes could not be run in letter and spirit. This is first time that concessionary proposal of 75 items has been submitted by Ministry of Commerce to European Union, which will be considered in March 2011. In this regard, the Committee urged to utilise all efforts to get these concessions with the confidence of all allied countries like India, Bangladesh, Sri Lanka, Vietnam and other countries. “A proper mechanism and course of action should be launched,” the Committee suggested.
The Committee appreciated that despite flood, war on terrorism and law and order situation, Pakistani exports have reached $2 billion per month in February, this due to tremendous role Pakistani businessman/farmers/exporters and traders. However, the Ministry of Commerce was advised to watch other factors of increase in exports like rise in prices of raw cotton, yarn, rice and other commodities. The committee expressed concerns over export of raw material of cotton, rice and other commodities, which is hurting local industry and domestic production. “Due to this, prices of local cloths have increased,” it told.
The committee urged that although cotton trade has been made free but efforts should be made to promote the trend of value addition in cotton/textile and other items, which can be done jointly by local industrialists and the Ministry of Commerce. The Committee advised to promote exports of other commodities like Kinnow, meat, etc. The Committee expressed satisfaction that “Pakistani grower is now getting international prices, luring local businessman/traders to participate in global trade system and free market regimes.”The committee was informed that quantity of export of different commodities has been increased. The export of rice has been increased by 84 percent in 2009-10 as compared to last year. Similarly, export quantity of different commodities such as meat increased by 43 percent, raw cotton by 116 percent, cotton yarn by 45 percent, yarn other than cotton yarn by 50 percent, art, silk and synthetic textile by 58 percent.The Committee expressed concerns that allocation for EDF for the year 2010-11 was Rs 2.097 billion where as only Rs 839.170 million has been released. The Committee also urged to bring transparency, rational and productivity in various ongoing projects.
Coming hard on the tax officers, Federal Minister for Finance and Revenue Abdul Hafeez Shaikh Wednesday said Federal Board of Revenue had to achieve the annual tax collection target of Rs 1604 billion at every cost.
Addressing the Chief Commissioners Conference of Inland Revenue Service on Wednesday, the finance minister said tax officers should work efficiently regarding tax collection otherwise they should quit their offices. He said country was facing several challenges, however, we need determination to resolve the economic issues, he added.
He asked the Chairman of Federal Board of Revenue (FBR) to assign revenue collection target to the tax commissioner and seek monthly reports from them in this regard. The government would give reward to officers, who would achieve the tax collection target, he said.
The Finance Minister cautioned the tax officers to focus on their working instead of watching television or reading newspapers at their offices. He said all the officers should have to be more alert and active and warned there will be zero tolerance for inefficient officers.
The people want that we have to be independent and in this regard have to generate our own resources, he said, adding that we are ready for negotiating with anyone regarding economic situation. He vowed that all the rich people would be brought under tax net and the collected money would be spent on the welfare for the poor.
About tax to GDP ratio, Hafeez said countries like Pakistan had increased the said ratio to 15 per cent while in some cases it is around 20 per cent. “If other countries could enhance the tax to GDP ratio, then why can’t we,” he questioned.
Earlier, Chairman Federal Board of Revenue, Salman Siddique informed that the government would increase the General Sales Tax to 16 per cent from existing eight per cent besides withdrawing 50 per cent subsidy on sugar. Market sources said the decision would result increase of Rs 5 per kilogramme.
He said the government is trying to broaden the existing tax base, as work is already started in this regard, he added.
On withdrawal of GST exemptions, FBR Chairman informed that some exemptions have been allowed under SROs and these can be withdrawn through the same. However, some GST exemptions were allowed through legislation and these would require amendments through parliament in the relevant legislation for withdrawal.
MULTAN,March 2nd:President of Multan Chamber of Commerce & Industry Shahid Naseem Khokhar has hailed the decision of President Asif Ali Zardari to form a committee comprising officials and representatives of leading business and industrial houses and stock exchanges to review the entire gas sector in the country and submit proposals for equitable availability of gas to domestic, industrial and commercial consumers across the country and described it a good step. In a press statement, Khokhar said that some elements were exploiting the situation and giving its political colour.He said that the Committee, to be headed by the minister for petroleum and in his absence by the secretary petroleum, will comprise representatives of the APTMA (All Pakistan Textile Mills Association) the Federation of Pakistan Chambers of Commerce and Industry, stock markets, the managing directors of the state sector gas supply companies and other relevant officials to redress the grievances of Industrialists of Punjab. According to him,President Zardari said the gas supply issues raised by the labour in Punjab must be looked into on a priority basis and their complaints addressed forthwith. “The PPP is a party of the labour and the problems and issues of the working class must be addressed urgently,” he said.The President said that the textile industry was critical for the country’s economy and that it must not be allowed to suffer on account of gas shortage.
MULTAN,Feb 28th:The business community has urged the government to immediately constitute economic reforms committee with representation from all the stakeholders including Chambers of Commerce, other trade bodies and political parties to urgently take up the challenges hampering the economic growth.
In a statement issued here, the LCCI’s former Senior Vice President Abdul Basit said that economic slowdown was not only causing unemployment but also creating law and order situation in the country and the government would have to evolve a well thought-out strategy to cope with the situation. He said that a number of industrialists had been shifted their industrial units to the other countries due to worst energy crisis, political instability, deteriorating law & order situation and economic meltdown while reportedly a large number of industrialists were also planning to shift their industrial operations to other countries because of unavailability of a conducive business atmosphere in Pakistan.
He said that not only the developed world but several countries of the region are on the path of rapid growth while situation in the Pakistan is quite different. He said that in the year 2003, industrial growth rate was 2.49% that reached 13.10% in year 2005 but in the year 2010, negative growth rate was registered with -3-60%.
Abdul Basit feared that the fiscal deficit could touch the staggering figure of Rs 1.2 trillion (about 8 percent of the GDP) if the situation remained the same for quite some time and resultantly the government would have to print billions of rupees that would trigger hyperinflation.
The former LCCI Senior Vice President said that an efficient handling of issues at hand would be a great national service and it was not the industrialists that are disturbed but the people at large are also feeling the heat.
He said that an immediate attention on the part of the government is needed to overcome the energy shortage that is the biggest hurdle in the way of economic growth.
“only because of electricity shortage, not only the business community is losing foreign orders but the goods are fast becoming uncompetitive.” Abdul Basit, who is also a former Chairman of poultry association, said that the government would also have to activate Pakistani mission abroad to make Pakistani merchandise familiar in the international market.He urged the government to work on war footing otherwise Pakistan would become only a trading place instead of manufacturing hub.
Meanwhile, Chairman PIAF Sohail Lashari has urged the Prime Minister of Pakistan Yousaf Raza Gillani to launch an independent investigation against the officials of NEPRA responsible for befooling the people by making wrong power tariff that caused heavy burden on the industrial and domestic users of electricity.
In a press statement issued here Wednesday, Sohail Lashari said that some officials in NEPRA and other government departments were busy in making anti-social policies therefore those elements should be brought to the justice and punished who had given financial and mental torture the masses.
He said that politician were busy in play blame-game instead of focusing their attention towards the betterment of the masses who are looking at them for some relief.
The Chairman PIAF said that electricity and gas load shedding have already paralized the industrial sector. Industrialists are unable to fulfil their exporters and their foreign buyers are making way to the other countries. He said that thousands industrial units have closed down their operations left millions industrial workers unemployed but instead of taking some relief measures, NEPRA and other government departments creating more hurdles.
Lashari said that industrial power tariff is 9 cent per unit and 9.5 cent per unit in India and Bangladesh respectively while Pakistani industrial users purchasing electricity on the higher price of 13 cent per unit. He said that markup rates were also too high when are compared with any of the developed economies, he added. He said that markup rate in US is 0.25 per cent, in UK 1.5 per cent, in Canada 1.5 per cent, in Australia 4.25 per cent, in Japan 0.1 per cent, in China 5.58 per cent, in India 5.5 per cent and in Bangladesh 7.61 per cent.
MULTAN,Feb 14th:Pakistan has potential to export jute products worth Rs.5 billion per annum besides meeting the requirements of Food department and PASSCO if Government give them incentive.Jute industry is the only job oriented industry which was providing jobs to 30,000 people in only ten units.If Government does not forbid the PASSCO and Food departments from purchasing polythene bags then they would be forced to cllose their units redering their workers jobless.It was stated by Pakistan Jute Mills Association Chairman Humayun Mazhar in an exclusive talk today. The jute mills, employing over 30,000 workforce in the country, are going to close, as all government departments have decided to use polybags for packaging, shunning the long-established and eco-friendly practice of packing in jute bags, posing health threat for the consumers.The government departments, including PASCO, Food, and Agriculture Departments have chosen to use polypropylene bags for packaging of wheat grains and other agri goods for their procurement. And in this regards all those departments have issued tenders for the purchase of polypropylene bags from the private sector, forcing the jute bags producers to shut their business.He said that jute bag is 100 percent biodegradable and recyclable and thus environmentally friendly. It is the cheapest vegetable fibre procured from the bast or skin of the plant’s stem. It is the second most important vegetable fibre after cotton, in terms of usage, global consumption, production, and availability. It has high tensile strength, low extensibility, and ensures better breathability of fabrics, he observed.
He said that till 70s all products, including cement and fertilizers were also packed in Hessians.
He pointed out that jute was an important foreign exchange earner for the producing countries during ‘60s. Even during the ‘70s, jute was an important commodity for most of the producing countries. However, during the ‘80s, bulk handling techniques and synthetic substitutes entered the market and jute started losing its predominant position in the market. The types of jute yarn manufactured can be classified according to the application to which they are put i.e. fine yarns, hessian yarns, carpet yarns, sacking yarns, etc.
Twines, ropes, cordages etc. are used for the purpose of tying, knotting, binding etc. particularly agricultural commodities. Hessian, Sacking, Scrim, CBC and Canvas are the most commonly used fabrics of jute. He said. “Our most of the production is utilized by the government for procurement and storage purposes as we use to supply it around 70 percent of our produce. Presently local jute mills running on their half capacity due to wrong policies of the government, as they are producing 1,50,000 ton jute product on average, while their full capacity is around 2,50,000 ton,” He stated: “We are asking the govt to inform us as to how much jute bags will they need so that we manufacture them as it is a lengthy process but it does not seem to interested in jute bags packing, because authorities have not responded us so far since its first tender in Dec last.”He said the PJMA told the govt that polypropylene bags are comparatively cheaper but they cannot be used second time while the jute bags are used 7 to 8 times continually and at the end they are 100 percent biodegradable i.e. when discarded, it decomposes, putting valuable nutrients back into the soil, the chairman remarked. He added that PASCO also said that it has tried the polybag which is dangerous for health. In the same way the Pakistan Standard Institute never approved the polybag for the purpose of packaging.The government has attempted to use polypropylene for packaging but totally failed as it messed up the wheat grain. Therefore, jute is very suitable in agricultural commodity bulk packaging. He said that jute has gained an advantage as being an eco-friendly option instead of poly and paper bags as polybags are made from petroleum and are non-biodegradable and manufacturing paperbags requires large quantities of wood. Jute has none of these problems and are therefore being used widely for these purposes but higher cost is a setback for it. He said that presently in developed countries it is also used for making fashion and promotional bags. Pakistan Jute Mills Association Chairman Humayun Mazhar said that India did scientific study to adopt options other than the jute bags and stated that there is no better way of packaging than the jute.
It made the environment impact assessment and declared that plastic packing is not biodegradable. “There is a package act in India according to which every agricultural product, including grains, will be packed in jute bag, as it could absorb the moisture in the agri items,” he pointed out. He made it clear that if government departments stick to their stance the jute miller would have left no option except shutdown of their mills which are already operating below their capacity.
“We have written so many letters to the several concerned departments to warn them against using polybags but no reply was given from them so far. Likewise we have written also to the Punjab CM to save this industry, he added.
He said currently country exports around Rs 1 billion jute products while the potential of export is over Rs 5 billion and if govt gives us incentives we can achieve this target within three or four years. He said that Bangladesh govt provides 10 percent subsidy to exporters while India gives 7 percent financial support to them, rendering us uncompetitive in the region. He informed the scribe that the jute industry employs 10 times more labour as compared to the spinning industry.
MULTAN,Feb 11th:Multan Chamber of Commerce and Industry (MCCI) stressed on the need for broadening tax base by bringing agriculturists and big farmers into the tax net.President MCCI Shahid Naseem Khokhar Thursday said levying withholding tax of 3.5 percent on traders and intermediaries of raw agriculture produce should also be rationalised.He said traders, intermediaries of raw agriculture produce were exempted of withholding tax through SRO.586 (1) 1991 of June 31,1991, now they have to pay 3.5 percent withholding tax vide SRO 1161(1) 2010 December 31, 2010.He was of the view that tax should be levied on the commission earned instead of levying it on the total trade. “The country is currently experiencing high inflation and impact of imposition of 3.5 percent tax on gross trade that would further increase the prices of many agriculture products,” he maintained.
MULTAN, June 7th;Political leaders of South Punjab have criticized the World Bank and the IMF dictated federal budget saying it would make the common man to further buckle under the burden of price hike and said the strategy to meet deficit worth Rs700 billion with the borrowings, would lead the national economy to slide down the steep.They stressed the need f adoption of the inexpensive energy resources that the ends relating poverty alleviation and employment opportunities could be achieved, he believed.PML-N's Senior Vice President Makhdoom Javed Hashmi has said the federal budget would further ramp up the burden of price hike on the public and resultantly, the problems faced by the poor, would snowball.
The PML-N leader said the federal government did nothing positive and concrete to bring the economy back on track in actuality, adding the betterment could be infused into national economy by acting on strategy of self-reliance sans loans.
Hashmi said apparently government has not announced imposition of any new taxes on food items which may help stabilization in their prices, however previous experiences bears testimony that the possibility of new taxes in the near future cannot be ruled out.He said that levying of 10 to 15 percent federal excise duty on electronic items, including Deep freezer, refrigerators and air conditioners, may affect a substantial section of the population, as these items have become household necessities with the passage of time and their increasing rates would have harmful impact on their daily sales. He opined that government had a better alternative of revenue generation by taxing items used by opulent segment of the population.Rana Mehmood-ul-Hassan,MNA and chairman of National Assembly's standing committee on ports and Shipping said the budget was balanced, adding that the government had tried to pull the country out of the financial crisis.He said the government had accepted the PML's stance on the Value Added Tax and had decided to reform the General Sales Tax system from October 2010. He hoped the budget would bring change in the country if all the announced measures were implemented. Financial experts in South Punjab on Sunday termed the 2010-11 budget a “wish list”, saying it lacks all production-oriented objectives as it is centred on deficit-controlling tactics, with the only positive being the relief provided to government employees. Pakistan Democratic Party Chief Nawabzada Mansoor Ahmed Khan said the budget is dictated by the World Bank and the IMF, and can hardly be called 'people-friendly'.Without expanding the tax base, the government can never generate enough revenue needed to run the country smoothly. It is important to provide extensive subsidies to the poor and downtrodden segment of the population.He added. Traders from Multan, Dera Ghazi Khan and Bahawalpur expressed mixed reactions on Federal 2010-11 budget and termed the budget “a big disappointment” for both trade and industry. The finance minister has failed to come up with any solid plans for the economic revival of the country they said. Khawaja Muhammad Shafiq Chairman of Pakistan Traders Alliance, Khalid Mehmood Qureshi President of Small Traders Alliance,and Malik Nazir Ahmed Awan have also expressed their dissatisfaction with the budget, saying it has brought no visible measures for the revival of the industry and economy and no actions to control the inflation rate, which had surpassed the 12 percent mark.
MULTAN, June 7th:Traders of Southern Punjab have urged upon the Federal and provincial Governments to convene a meeting of traders to resolve their problems so that 8 million small traders could keep continue their trade activities in free and fair manners.Ten power plants which are lying closed be reactivated instead of Rental Power plants to bridge the gap of demand and supply of electricity.Addressing a joint press conference in Multan Press Club on Monday Khawaja Muhammad Suleman Siddiqui, Central Senior Vice president of Markazi Anjuman Tajiran Pakistan, Malik Nazir Ahmed Awan, Central Chairman of Markazi Anjuman Tajiran, Muhammad Akhtar Butt, President of Pakistan Chemists & Druggists Association (PCDA) Shaikh Akram Hakim , Soofi Abdul Rehman Bhatti, Dr. Mazhar Nawaz, Muhammad Idrees Butt, Arif Fasih-ullah, Shaikh Muhammad Rauf, President of Anjuman Tajiran,Shaikh Suhail Akhtar, Haji Shoaib Mumtaz, and Javed Akhtar Khan vowed not to comply with the orders of the Government to shut their business concerns at 0800 PM and payment of Value Added Tax (VAT) from October Ist,2010.They urged upon the PEPCO to withdraw its schedule of power shut-down for two hours from 0800 to 1000 PM.They said that Government wanted to keep the traders and the entire nation in the fetters of VAT for the pleasures of the IMF/ World bank. They rejected the one percent increase in the General sales tax describing it harmful to national economy and said that 15 percent General sales tax be introduced. Traders also opposed the levy of 10 percent Federal Excise Duty on the sales of Deep-freezers, Air-conditioners and other electronic appliances.Traders of Southern Punjab also opposed the 0.3 percent withholding tax on the transaction of amount, travel cheques,Pay orders, Demand Drafts etc.
The business community of the South Punjab has expressed dissatisfaction over the federal budget for the next fiscal year 2010-11 and said it is ambigious and unfriendly to business, trade and industry. Terming the federal budget for 2009-10 as manipulation of words and figures, the business community and industrialists have rejected it and lashed out at the federal government for not announcing an industry friendly budget.These were the views of the business community after Finance Advisor Dr Abdul Hafeez Shaikh presented Federal Budget for 2010-11 with a total outlay of Rs 3.259 trillion before the parliament on Saturday.Malik Asrar Ahmed Awan Multan Chamber of Commerce and Industry (MCCI) said that the budget is totally politically benefited statements and is not going to benefit trade and industry.President MCCI said that some steps are good but showing his concerns on the tax revenue that is targeted at Rs 1.78 trillion out of which the Federal Board of Revenue would collect Rs 1.667 trillion, about 9.8 percent of GDP, he said that from where it would be achieved. He said that people were afraid of the new tax system called Value Added Tax (VAT), and the government very smartly changed it to term 'reform GST'. He was of the view that the basically GST and VAT are not different tax systems and the government just changed its name to VAT.He opposed the levy of 0.3 percent withholding tax on the cash transaction, pay order, pay draft and said that it would badly hit the trade and It would be be another shape of turnover tax.President MCCI said "the government should have allocated a huge amount for granting incentives to the industrial sector, farming sector or other productive sectors that generate jobs and capital."MCCI Chief said that most of budget proposals have not been considered as the government has increased withholding tax against our proposals. However, the continuation of zero-rated sector is a good step by the government. He was of the view that continuation of regulatory duty on imports would prove fatal for many industries in the provided environment of doing business.Awan said that the government has increased the Federal Excise Duty on some electronic items including air conditioners and refrigerators, which would decrease their legal import and increase massive smuggling to give huge losses to the government's revenue.In his reaction to the annual budget, Khawaja Muhammad Usman Senior Vice President said apparently government has not announced imposition of any new taxes on food items which may help stabilization in their prices, however previous experiences bears testimony that the possibility of new taxes in the near future cannot be ruled out.He said that levying of 10 to 15 percent federal excise duty on electronic items, including Deep freezer, refrigerators and air conditioners, may affect a substantial section of the population, as these items have become household necessities with the passage of time and their increasing rates would have harmful impact on their daily sales.
Replying to a query, he opined that government had a better alternative of revenue generation by taxing items used by opulent segment of the population, however its choice of taxing electronic items clearly indicates that it has pursued a safer policy - as helpless consumers of electrical appliances can hardly vent their outrage against the arbitrary levying of heavy taxes.President of Tax Bar Association Asad Chaudhry said the budget is dictated by the World Bank and the IMF, and can hardly be called 'people-friendly'.Without expanding the tax base, the government can never generate enough revenue needed to run the country smoothly. It is important to provide extensive subsidies to the poor and downtrodden segment of the population.He added. Traders from Multan, Dera Ghazi Khan and Bahawalpur expressed mixed reactions on Federal 2010-11 budget and termed the budget “a big disappointment” for both trade and industry. The finance minister has failed to come up with any solid plans for the economic revival of the country they said. Khawaja Muhammad Shafiq Chairman of Pakistan Traders Alliance, Khalid Mehmood Qureshi President of Small Traders Alliance,and Malik Nazir Ahmed Awan have also expressed their dissatisfaction with the budget, saying it has brought no visible measures for the revival of the industry and economy and no actions to control the inflation rate, which had surpassed the 12 percent mark.Rana Mehmood-ul-Hassan,MNA and chairman of National Assembly's standing committee on ports and Shipping said the budget was balanced, adding that the government had tried to pull the country out of the financial crisis.He said the government had accepted the PML's stance on the Value Added Tax and had decided to reform the General Sales Tax system from October 2010. He hoped the budget would bring change in the country if all the announced measures were implemented. Financial experts in South Punjab on Sunday termed the 2010-11 budget a “wish list”, saying it lacks all production-oriented objectives as it is centred on deficit-controlling tactics, with the only positive being the relief provided to government employees.Prof .Dr.Shahnawaz Malik of BZU said no major project had been announced to tackle the issues of load shedding and terrorism, the two biggest challenges confronting Pakistan. The one promising feature of the budget is the 50 percent salary increase for government employees, however, only a “lollypop” has been given to the pensioners with a miserly 15 to 20 percent increase, he added. Renowned economist Dr.Karamat Ali termed the commerce minister’s budget speech “a political one”, saying it seemed that the objective of the budget was not to promote production but to manage deficits. He said a small 10 percent cut in the salary of a huge cabinet members was not appropriate. He said the Value Added Tax was not practical for a developing country like Pakistan. He said that former finance minister also vowed to reduce non-development expenditures, but no serious efforts were made to this end.He bitterly criticised the ending of critical subsidy on Atta and, pulses, rice and tea at utility stores. In other words, no more ‘affordable’ basic food items for the needy poor who would line the stores to save every precious rupee. Maybe they were better off as long they had remained forgotten, to quote the minister.According to economic experts, the increase in GST will further fatten the already killing domestic electricity and gas bills. Meanwhile, the government has reduced the income tax collected along with the electricity monthly bill from the industrial and commercial consumers from 10 to five per cent, a move aimed more at benefiting the relatively affluent segment of the society. In another surprise move, the government has also doubled the federal excise duty (FED) on gas from five per cent to 10 per cent. This translates into a Rs10 per MMBTU increase in FED. This too would have an adverse inflationary impact on gas bills across the country, according to economic experts.
MULTAN,June 6th: Bangladesh High Commissioner Designate Mehfooz-u-rehman has said Bangleshi Cricket team was not reluctant to visit Pakistan and it was ready to play in Pakistan and hoped that both countries would promote the healthy sport activities in two brethern countries. Talking to newsmen on Sunday at Multan Press Club the high commissioner said that Bangladesh wanted to inroduce a ferry service between Karachi and Chittagong to promote the bilateral trade and we had agreed in SAARC conference to develop the free trade among the member countries and relaxing the visa restrictions.He disclosed that Bangladesh Government was actively considering a proposal to establish its consulate in Multan which is an historical and ancient city of the world.He said that Multan is a city of Soofis, spiritual saints like Bahauddin Zikiriya, Shah Rukn-i-Alam, Hazrat Moosa Pak Shaheed, Shah Shams Sabzwari who had preached the message of peace, love and tolerance. Mehfooz said that people of Bangladesh and Pakistan have a common past and collective efforts are needed to cement bilateral relations and exchange of delegations is of vital importance in this regard.He said in order to promote economic and trade relations, Bangladesh and Pakistan can launch joint ventures for mutual benefit. He said intelligentsia of both the countries should also find out ways and means for further strengthening of relations between both the countries. He said democracy aimed at public service, therefore, in addition to strengthening the democratic institutions, measures should also be taken for the solution of people’s problems. Ishtiaq Ahmed threw light on the achievement of Bangladesh and also expressed best wishes for the progress and development of Pakistani people.
MULTAN, June 5th: More than 200 traders organisation have announced to close their shops and markets at 0900 PM instead of 0800 and not to pay any fine to any authority besides rejection the value added tax describing it unjust,unfair and cruel.It was announced at a traders convention chaired by Khawaja Suleman Siddiqui and addressed by Haji Maqsood Butt, President of All Pakistan Anjuman Tajiranb, Abdul Razzaq Bubbar, Secretary GEneral, Mehboob Sirki, Shaikh Akhtar (D.G.Khan)Shaikh Abbas Ahmed (Mailsi), Malik Nazir Ahmed AWan Chairman of All Pakistan Anjuman Tajiran Cantonment boards, Khaliq Qandeel Sindhu, Secretary General of All Pakistan Power Looms Association,Muhammad Akhtar Butt, President of Pakistan Chemists & Druggists Association Punjab, Murid Hussain Gashkori, Zain-ul-abideen Motiwalay, Dr.Mazhar Nawaz Khan.They said that Government had shut our business at 0800 PM but did not provide any relief to other consumers. Instead the duration of loadshedding was increased.They said that customers visit the markets after sunset due to scorching heat in day time. All the Bazars and Markets look deserted till 0700 PM Soon after Maghrib prayers,we were forced to close our business and Magistrates were imposing fines Rs.1000 to 2000 on the traders.They decided to resist against the Government and administrate if the value added tax was imposed and they were forced to close our business at 0800 PM. They said the strong arm tactics of the police and administration to get the shops closed were indecent.“When we lodged complaints about rising street crime in some markets few days back the police high-ups said the force was too occupied in manning the security posts, but now scores of policemen are available to roam around markets,” they added the traders’ leaders said there was no let-up in the power cuts despite the two-day holiday and closure of business centres early in the evening. They said load shedding had badly disturbed their life.They said that imposing the VAT at a time when business activities had grinded to a halt would be tantamount to rubbing salt into their wounds.
MULTAN,June 4th: Over 3.5 million tyres worth Rs.10 billion are being smuggled from India,China, Russia, Japan and Italy via Afghanistan.A number of markets are doing business of smuggled tyres in Dera Ghazi Khan, Multan, Lahore, Ruknee, Dera Ismail Khan.The annual demand of tyres in the domestic market is over 6 million but the local industry is operating with production capacity of only 2.5 million tyres due to influx of smuggled and under-invoiced foreign brands.The smuggling of tyres severely damaging the indigenous tyre industry. Due to lesser production of tyres, these are to be imported into the country, which invites mafia to take control of the trade process. In the guise of Afghan Transit Trade (ATT) the local industry was being marginalised as the traders all across Pakistan bought those smuggled tyres as they cost less. The duty was also evaded by under-invoicing by the local officials. The importers misinform the customs authorities about the actual price by stating it very low, thus evading tax by complicity of the tax authorities.The government should not decrease the duty or tax on tyres. On the contrary, the government should protect the indigenous industry like India. It is worth mentioning that the country is losing billions of rupees in foreign exchange and billions in revenue as the local market currently is flooded by brands coming from all over the world including China, which find their way into Pakistan primarily through under-invoicing and smuggling. An official of the industry said that economic downturn has also taken its toll as the manufacturers planned and executed huge capacity expansion in 2005-06, when it was projected that the country would be producing over half a million cars by 2010-11. He said it is incomprehensible as to why the massive under-invoicing is tolerated by the government. "It is just a matter of finding the right price through Internet," he said and added that the export price fetched by local tyres is another indicator of globally competitive rates.He said that smuggling is conducted mainly due to loopholes in the ATT. He said that there are no quantitative curbs on imports of tyres into Afghanistan although the authorities are fully aware that these imports are meant for Pakistani markets.The population of Afghanistan is less than 20 percent the population of Pakistan while 63 percent of its population lives under poverty levels. Yet its imports are completely disproportionate to its genuine needs. He urged the government to plug the massive loopholes in ATT if it desires the industry to survive, grow, create more jobs, pay more taxes and export goods to earn foreign exchange.
MULTAN,June 3rd:The Pakistan State Oil (PSO) is facing a distinct possibility of default which might disable it from paying its dues to the oil refineries, and for imports, and has warned the Pakistan International Airlines (PIA) that it would suspend fuel supply from July 1, in case of continued default, it has learnt.According to sources, PSO management in a letter sent to PIA Managing Director (MD) Captain Muhammad Aijaz Haroon stated that due to cash flow problems, PSO's position has gone from bad to worse. "We are facing tremendous pressure of default of payments to refineries and in imports of various products such as petrol, high speed diesel (HSD), furnace oil and jet fuel for the entire country which is most essential to keep the wheels moving," the letter said.PSO management has drawn attention of PIA MD towards various correspondence in which it had committed to clear the dues by June 30, 2010. "Since PSO and PIA have worked together hand in hand for decades and therefore I request you to clear all dues by June 30, 2010 so that PSO can maintain uninterrupted fuel supplies," PSO management said adding that "we have been accommodating the national career as much as possible but now in current scenario we are not in a position to accept your further request."Please note that PSO will have no other option but to suspend the supplies from July 1, 2010 in case the outstanding amount along with financial charges is not cleared," PSO management said.While referring to letter dated March 1, 2010 addressed to Director Finance PIAC, PSO lamented that the schedule of payment by PIA has regretfully not been followed. "It is also important to note that in the said payment schedule we also advised that the actual outstanding payment was Rs 1.822 billion with a later payment surcharge of Rs 884 million as against Rs 1.660 billion mentioned by you in your letter dated February 19, 2010,"PSO adds.As on June 2, PSO receivables from different clients including power sector were Rs 127.8 billion which include: Wapda Rs 41.14 billion, Hubco Rs 48.09 billion, Kapco Rs 25.11 billion, OGDC Rs 396 million, KESC Rs 1.72 billion, Power Holding co Rs 1.3 billion, price differential claims (PDC) on imported HSD Rs 1.382 billion, PDC on imported PMG Rs 2.93 billion, PDC under gas load management plan (KESC) winter 2010 Rs 2.409 billion and PDC under gas load management plan (KESC) summer 2010, Rs 1.167 billion.PSO payables to local refineries as well as international fuel suppliers are Rs 120.18 billion which include; Rs 31.45 billion to Parco, Rs 12.35 billion to PRL, Rs 9.34 billion to NRL, Rs 18.24 billion to ARL and Rs 4.84 billion to Bosicor.PSO is to make payment of Rs 43.47 billion on account of L/C to KPC and fuel suppliers.
