Lahore Chamber Of Commerce And Industry (LCCI) Discloses Proposals For Upcoming Federal Budget

Federal Finance Minister has assured Lahore Chamber of Commerce and Industry (LCCI) that the Federal Budget 2023-24 would be business friendly

LAHORE, (UrduPoint / Pakistan Point News - 31st May, 2023 ) :Federal Finance Minister has assured Lahore Chamber of Commerce and Industry (LCCI) that the Federal Budget 2023-24 would be business friendly.

This was stated by the LCCI President Kashif Anwar while addressing at a press conference on upcoming Federal Budget 2023-24 here at Lahore Chamber on Wednesday. LCCI Senior Vice President Zafar Mahmood Chaudhry and Vice President Adnan Khalid Butt also spoke on the occasion.

The LCCI President informed the media that recently he has a fruitful meeting with the Federal Finance Minister Ishaq Dar and apprised him of the issues being faced by the business community besides presenting a set of budget proposals for the financial year 2023-24.

Sharing budget proposals with reporters, the LCCI President Kashif Anwar said that since the position of foreign reserves is improving, the government should take measures including trade in local Currency where ever possible and barter trade mechanism to mitigate the prevailing foreign exchange crisis.

He said that for broadening of tax base and better documentation, there should be facilitation in the form of declaration scheme which must be introduced to bring undeclared foreign reserves, local assets and wealth in economic circle for injection of liquidity in economy.

To reduce the cost of doing business, Kashif Anwar emphasized the need to align Pakistan's interest rates with regional economies. He also urged the government to lower the refinance rate, introduce soft policies for small and medium-sized enterprises (SMEs), and provide special financing schemes with low markup rates and no collateral requirements.

The LCCI President emphasized on the importance of reducing the cost of doing business, particularly energy costs and land expenses, to promote industrialization and private sector growth in line with regional economies.

In order to enhance tax compliance and documentation, he proposed the introduction of a declaration scheme. This scheme would encourage individuals to bring undeclared foreign reserves, local assets, and wealth into the economic system, injecting liquidity into the economy.

President LCCI also called for raising awareness among non-filers about the benefits of entering into the tax net.

He suggested expanding the tax base by bringing individuals with industrial or commercial electricity or gas connections into the tax net. He recommended charging a 25 percent income tax on the bills (electricity/gas) of non-filers and emphasized the need for a National Tax Number (NTN) for new commercial electricity/gas connections.

The LCCI President also called for the reduction of fines, penalties, and surcharges imposed on taxpayers. He suggested rationalizing penalties based on revenue loss and adjusting determined advance tax against pending refunds. He emphasized the importance of establishing a committee to clear the refund backlog promptly.

Kashif Anwar highlighted the need to expedite the resolution of tax revenue claims and proposed active engagement with the Alternative Dispute Resolution Committee (ADRC). He suggested granting chambers of commerce representation in the ADRC and ensuring that its decisions were binding and not challengeable by tax forums.

Regarding tax exemptions, Kashif Anwar recommended against extending the sales tax and income tax exemptions granted to industries in the erstwhile FATA/PATA region beyond June 30, 2023. He called for simplifying the sales tax system and reducing the high sales tax rate on inputs for export-oriented industries.

Kashif Anwar suggested removing area specifications for Tier-1 retailers and exempting one-shop retailers from point-of-sale (POS) integration. He proposed using electricity consumption units as a parameter instead of the cost of electricity and reducing the import sales tax on capital goods, plant, and equipment to zero percent.

The LCCI President highlighted the high corporate tax rate in Pakistan and suggested gradually reducing it to 15 percent. He called for minimizing withholding taxes for active taxpayers.

President LCCI concluded by recommending automation of the process of income tax refunds under section 170 for faster processing and to address liquidity issues.

LCCI Senior Vice President Zafar Mahmood Chaudhry said that commercial importers should be supported. He said that a board should be formed for import substitution and stakeholders should be taken on board. He said, "We need US $ 25 billion to stabilize our economy and overseas Pakistanis should be encouraged to increase remittances. Those who send a reasonable amount, should be given blue passport that can help increase remittances to US $ 70 billion." He said that SMEs and value addition should also be focused.

Vice President Adnan Khalid Butt said that government should encourage people to come into the tax net. He said that viable policies should be formed for the promotion of SMEs.