KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Tuesday warned closure of factories in the country due to highly volatile rupee/dollar parity.
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FPCCI demands 10% cut in petroleum prices
KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Wednesday demanded the government to reduce petroleum prices by at least 10 per cent without any delay.
FPCCI president Irfan Iqbal Sheikh in a statement on Wednesday demanded that the government should slash the prices of the petroleum products by 10 percent immediately as the international oil prices have substantively come down; and, the benefit needs to be shifted to the masses.
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He noted with a sigh of relief that oil prices are now under $100 per barrel. The move will bring down the inflation in a much more effective and tangible manner than raising the interest rate to a 14-year high of 15 percent, he added.
Irfan Iqbal Sheikh emphasized that the full force of the multiplier effect of the raise of the petroleum products has not yet materialized in Pakistan and inflation will keep rising in coming 2 – 4 weeks if the relief from international market is not shifted to the end consumer.
READ MORE: FPCCI identifies tax anomalies in budget 2022-2023
FPCCI Chief explained that global macroeconomic sentiments are not optimistic and growth forecasts have been significantly lowered to the tune of being recessionary; and, the phenomenon may drive the international oil prices even lower than $90 per barrel in coming weeks. However, he maintained, we have to tread a cautious path and gradually but progressively lower the domestic petroleum prices.
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Irfan Iqbal Sheikh has put forward two of the supplemental concerns of the business community with regards to the petroleum prices: (i) reliable and uninterrupted supply of the petroleum products in the backdrop of torrential rains across the length and breadth of the country (ii) further devaluation and volatility of the rupee in the inter-bank intra-day market observed on the first working day after Eid Ul Azha holidays, i.e. Wednesday, July 13, 2022 – which has the potential to partially nullify the effects of the drop in the international oil prices.
FPCCI President has called for the prudent and diligent regulation of the markets to allow the country to benefit from the downward trends in international oil prices, edible oils and initial signs of receding supply constraints in some other commodities.
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Karachi Chamber demands declaring rain emergency
KARACHI: Karachi Chamber of Commerce and Industry (KCCI) has demanded the government of declaring an emergency after human and financial losses in the city during torrential rains in past few days.
READ MORE: KCCI demands release of stuck up containers
KCCI President Muhammad Idrees in statement urged Prime Minister Shehbaz Sharif to take immediate measures to prevent further human and financial losses in the city as more rains had been predicted.
Idrees lamented the present situation in Karachi after heavy downpour especially during the past 24 hours. He said the provincial and local authorities had failed to relief and take measures to control the flooding like situation.
READ MORE: KCCI demands implementation of Riba free banking
“The city collects about 70 per cent revenue for the national exchequer. But the present situation has created insecurity amongst the people of the metropolis,” he said.
“The Wall Street of Pakistan i.e. I. I. Chundrigar Road is completely vanished due to flooding. Besides, the old city area were also showing disaster everywhere,” he added.
The KCCI President urged the Prime Minister to announce compensation to the losses and also grant duty and tax relief for the business community.
READ MORE: KCCI appeals rescuing small traders in Catch-22 situation
He pointed out that there was no allocation in the budget 2022/2023 for the financial hub. He further pointed out that the previous government had allocated around Rs1.1 trillion for the city but no development project was seen.
Idrees demanded the federal government to take control of the city and provide maximum relief to avoid further losses in expected rains.
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KCCI demands release of stuck up containers
Karachi Chamber of Commerce and Industry (KCCI) on Monday demanded the government of releasing containers imported goods that were banned through SRO 598(I)/2022.
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KCCI demands implementation of Riba free banking
KARACHI: Karachi Chamber of Commerce and Industry (KCCI) on Friday demanded the government for early implementation of Riba free banking in Pakistan.
Chairman Businessmen Group in the KCCI, Zubair Motiwala, and KCCI President, Muhammad Idrees have extended gratitude to Prime Minister Shahbaz Sharif for taking interest in the implementation of the Federal Shariah Court’s decision of introducing Riba Free banking in Pakistan.
READ MORE: KCCI appeals rescuing small traders in Catch-22 situation
They have requested the government to introduce interest free banking in Pakistan according to the Islamic Principles and implement the court’s decision in true letter and spirit.
The Federal Shariah Court gave a verdict on 28 April 2022 after a lapse of 19 years. In the judgment, it declared that Riba was prohibited according to the injunctions of Islam so it should be eliminated from the country with in a period of five years.
This statement was issued in response to an appeal filed by the State Bank of Pakistan, and four other banks in the Supreme Court of Pakistan against the Shariah Court’s Judgment. They termed the appeal as move to delay the conversion of conventional banking system to Riba free mode to banking. They also appreciated the assurance given by the PM Shahbaz Sharif to influence the banks to withdraw their appeals from the Supreme Court so that the Shariah Court’s decision could be implemented.
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Chairman BMG Zubair Motiwala said, “Other Islamic countries like Saudi Arabia, Iran and Malaysia have made significant headway in implementing Islamic mode of financing in their respective countries. Like, Malaysia has an Islamic Financial Services Board which has set Standards, Guiding Principles and Technical Notes for the Islamic financial services industry. I believe that if these countries are able to successfully adopt Islamic financial system, Pakistan can also shift to Islamic Financing system in the decent span of five years”.
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President KCCI Muhammad Idrees urged that all stakeholder groups should be consulted and if there are any genuine issues then these should be resolved on a fast-track basis to pave way for timely implementation of Islamic Financial System in the country.
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Committee recommends lifting import ban on luxury items
A high-level committee of Pakistan’s leading businessmen, tasked with reviewing budget anomalies, has formally recommended lifting the ban on the import of luxury items.
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FPCCI denounces super tax imposition
KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has denounced the imposition of super tax by the government to generate additional revenue.
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FPCCI identifies tax anomalies in budget 2022-2023
KARACHI: Federation of Pakistan Chamber of Commerce and Industry (FPCCI) has identified anomalies in the federal budget 2022-2023.
In a statement issued on Wednesday, Shabbir Mansha, Acting President FPCCI, expressed his profound concerns on the glaring anomalies in the federal budget 2022 – 2023.
“We have noticed anomalies in custom duties, regularity duties, income tax and sales tax,” he added.
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Mansha noted that turnover tax of 1.25 percent for traders, distributors and dealers is unbearable as profit margins are barely 2 percent in market sales and the turnover tax will continue to discourage SMEs to be registered in sales tax.
Acting FPCCI Chief pointed out that 4.5 percent withholding tax on local sale; but, normally trade margins are between 2 – 3 percent and there is no way a business can absorb 4.5 percent withholding tax and continue to operate viably. Therefore, sellers find it more viable to buy goods at 20 percent taxes; when accounted for additional duty of 3 percent on commercial importers on top of 17 percent sales tax and delist from the sales tax.
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He demanded that disparities in the rates of sales tax on raw materials at import stage between commercial and industrial importers. The FPCCI chief maintained that under section 8 (b) of sales tax act 1990, input tax adjustment in excess of 90 percent of the output tax is not allowed. This condition should be withdrawn; as the same has been already extended to companies operating in various sectors. Furthermore, withholding tax on import of raw materials should be the same for industrial and commercial importers.
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Mansha has proposed that at the stage of deregistering from the sales tax system, the condition of prior audit should be withdrawn to facilitate exit after three years; provided a company, individual or association of persons (AOP) was filling a null return for the past five years due to discontinuation of their businesses.
On the withdrawal of NIC condition through amending the section 23(I)(b), FPCCI has appreciated the government; but, maintained that the Finance Bill 2022 should categorically state that no NIC would be required for sales to non-filers.
Mansha also raised the issue of 12 percent tax under section 233(1). Additionally, freight and transportation charges under section 153(1)(b) at 3 percent should only be applied on final tax region.
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Paper merchants slam price hike by local producers
KARACHI: Paper merchants and graphic printers are facing with a severe shortage of paper, while the local producers have increased the prices by over 200 percent pushing the printing and packaging industry towards collapse.
Speaking at a press conference at Karachi Press Club, Chairman Pakistan Association of Printing Graphic Art Industry on Tuesday, Aziz Khalid said there was a severe shortage of paper in the country, and local paper mills were fixing the rates at their will.
“Local mills produce low quality paper and are unable to meet the demand.”
He said due to the scarcity of paper, printers couldn’t print the school syllabus so far, which was impacting the students of Sindh and Punjab Text Book Boards.
Criticizing the policies of the government as negative, Khalid claimed over 18,000 units involved in the printing and packaging supply chain were suffering due to higher taxes on imported paper.
“We have approached the Ministry of Finance, Commerce Division and Federal Board of Revenue FBR apprising them of the problems of the paper and printing industry, but there is no redressal”.
Speaking on the occasion, former Chairman All Pakistan Paper Merchants Association, Muhammad Saleem Bikyia said the government allows them to import paper, and the government revenue would be doubled.
“The former government imposed multiple taxes on educational paper imports, while the locally produced paper is very low quality as well as unable to meet demand.”
It may be mentioned here that the printing and packaging is the second largest value-added industry after textiles.
High prices & inferior quality are the major factors to confine us to enter US$:1000 billion export markets of books/leaflets/ packaging materials etc., which are mainly consumes by Singapore, Malaysia, China, India and UAE, said Bikyia.
Federal Minister of Finance & Revenue unfairly imposed 10 per cent Regulatory Duty (RD) in uncoated woodfree paper (HS Code 4802) in year budget 2021-22 despite of facts that 11 per cent to 39 per cent Anti-Dumping Duty already exists in said item. This is double jeopardy tax. Lawfully, Regulatory Duty (RD) cannot be enforced when Anti-Dumping duty already exists.
Saleem Bikyia said that there is No duty on basis Raw Materials i.e. pulp (H.S Code 47), and tiny 5 per cent duty on finished goods i.e. printed books, literary materials (HS Code 49); however in semi-finished Raw Material (H.S Code 48) i.e. paper & paperboard there is 16 per cent customs duty taxes, 4 per cent Additional Customs Duty, 10 per cent RD, & 11 per cent to 39 per cent Anti-Dumping Duty.
The stakeholders urged Federal Board of Revenue (FBR) to initiate investigation to substantiate how much 90 per cent domestic paper producers produce and pay sales taxes to national exchequer compare with 10 per cent imported paper who pay advance 17 per cent sales tax and 3 per cent value added tax at custom stage, results of billions of rupees of corruption, pilferage, swindle and embezzlement of local paper.
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Yarn merchants demand removing budget anomalies
KARACHI: Pakistan Yarn Merchants Association (PYMA) has urged the finance minister to remove anomalies in the budget 2022/2023.
In a statement on Friday, Saqib Naseem, Chairman PYMA, Muhammad Junaid Teli, Vice Chairman, Sind & Balochistan region, has drawn attention of Minister for Finance and Revenue, Miftah Ismail over anomalies in Federal Budget 2022-23.
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PYMA office bearers elaborated that Polyester filament yarn (H.S. CODE 5402.3300, 5402.4600, 5402.4700 and 5402.5200), also known as Man-Made Yarn, is the basic raw material for Pakistan’s textile industry.
The share of cotton in global fiber consumption has fallen from nearly 70 per cent back in 1960, to only 27 percent by end 2020. Its place has now been captured by synthetic or man-made yarns.
“A very large SME sector of Pakistan’s textile industry (more than 500,000 looms and knitting machines) consumes Polyester filament yarn. The commercial importers of Polyester Filament yarn act as financiers to this SME sector and entertain the requirements of this SME sector using their own capital and resources,” they said.
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Saqib Naseem, Junaid Teli added that we have seen in the past that whenever the difference in W.H.T is more than 1 per cent on Commercial Imports v/s Industrial Import, majority imports of Polyester Filament yarn shift towards industrial imports which leads to corruption and misuse of this facility and to the exchequer.
They further said that Polyester Filament yarn falls under the category of Raw Materials (SRO 1125) and in the previous budget FY 2021-22, the G.O.P imposed W.H.T at import stage 1 per cent for industrial importers and 2 per cent on commercial. However, in the Federal Budget 2022-23, the G.O.P has kept W.H.T @1 per cent for industrial imports falling under SRO 1125 whereas commercial importers shall be charged W.H.T @3.5 per cent with M.T.R and @ 4 per cent with F.T.R. Polyester filament yarn tariff already exists in the cascading system of polyester value chain & it is already on the higher side.
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Saqib Naseem, Junaid Teli requested Minister for Finance & Revenue, Miftah Ismail to kindly continue with 2 per cent W.H.T with FTR on Commercial Imports on items falling under SRO1125. Furthermore, in view of information from Reliable sources, it has been learned that the government may impose ACD & RD on Polyester Filament Yarn (H.S Code: 5402.3300, 5402.4600, 5402.4700 & 5402.5200).
Since these are basic raw materials of the Textile Industry, therefore we are requesting you not to impose any ACD & RD on these H.S Codes. We would also request you to Rationalize Custom Duty Tariff of POY (5402.4600) & PFDY (5402.4700) @7 per cent instead of present 11 per cent.