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  • KCCI wants end lockdown, deploy army for SOP enforcement

    KCCI wants end lockdown, deploy army for SOP enforcement

    KARACHI: Karachi Chamber of Commerce and Industry (KCCI) on Wednesday urged the government to lift lockdown completely and allow all type of businesses to restart their activities.

    Siraj Kassam Teli, Chairman Businessmen Group (BMG) and former KCCI president in a statement also advised the government to deploy troops from the army whose presence and patrolling at various commercial markets would ensure strict adherence to the Standard Operating Procedures (SOPs) devised to contain further spread of coronavirus pandemic.

    Teli said that Pakistan’s economy was already in deep crises and the country cannot afford further damages hence, it was really critical to restart all businesses with normal timings and get back to routine life in presence of the virus.

    “On one hand, we have to contain coronavirus pandemic but on the other, we also have to save the already ailing economy therefore, the patriotic and disciplined troops from armed forces must be given the task to ensure across the board implementation of SOPs, which has to be done on top priority in order to save the economy from plunging into further crises,” he said, adding that reopening of businesses under army’s supervision would help in protecting the businesses from complete collapse and save the masses from unemployment, poverty and starvation.

    Chairman BMG, while referring to numerous measures adopted by the Federal and Provincial governments since the imposition of lockdown from March 23, said that the federal government and all provincial governments strived really hard to deal with COVID-19 pandemic and they all deserve to be appreciated but unfortunately, the number of people affected by coronavirus continues to rise all over the country as the public and also the members of the business community have been largely ignoring the SOPs due to lack of discipline.

    “Pakistan army is well-known for its discipline all around the world hence, it is high time that the army must come forward to rescue the country, teach discipline to the masses and get the SOPs enforced all the time which is the only way to save our beloved motherland from further disaster,” he added.

    He stressed that the coronavirus pandemic is not going anywhere and we have to live with it and continue our businesses in a disciplined manner.

    “We cannot live in the lockdown forever so we have to exhibit the Discipline which is the first step on the road to success.”

    He cautioned that if the lockdown is not suspended immediately, many businesses, which remain completely suspended since last more than two months, would shut down forever that would lead to creating a chaotic situation as the people would find no other option but to come out on streets to protest due to rising unemployment and poverty.

  • Manufacturers demand domestic supplies against FE should be treated as exports

    Manufacturers demand domestic supplies against FE should be treated as exports

    KARACHI: Manufacturers have urged the government to treat goods booked abroad on which foreign exchange (FE) has been transferred should be treated as export.

    Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in its proposals for budget 2020/2021, said that some manufacturers (like Dawlance etc.) are demanding that overseas Pakistanis may be allowed to send foreign exchange to manufacturers through banking channel for delivery of goods to their blood relations / relatives in Pakistan, which may be treated as export.

    Some stores outside Pakistan have contacted the manufacturers for delivery of goods in Pakistan. These stores in foreign countries will make consolidated payment in FE through banking channel to manufacturers in Pakistan.

    They have requested the manufacturers in Pakistan to send samples for booking of orders. The issue is that after payment of duty and taxes the goods made in

    Pakistan become more expensive.

    The Pakistanis expatriates abroad then prefers to purchase smuggled goods from the open market or send goods in baggage (better quality and less cost) declaring it as old and used goods after removing its packing etc.

    Store owners abroad have shown keen interest in booking Pakistani manufactured goods to be delivered in Pakistan.

    “It is, therefore, proposed that such goods, where orders are booked from abroad and foreign exchange is sent in Pakistan through banking channels, may be treated as exported goods and may be exempted from local duty and taxes or partial exemption may be given in the form of fixed duty drawback / rebate of tax to be notified.”

  • Sindh urged to bring down sales tax rate at 10 percent

    Sindh urged to bring down sales tax rate at 10 percent

    KARACHI: Sindh Revenue Board (SRB) has been suggested to bring down sales tax on services rate to 10 percent from existing 13 percent to encourage registration of more taxpayers.

    Overseas Investors Chambers of Commerce and Industry (OICCI) in its budget proposals 2020/2021 submitted to the SRB, said that the expectations of the investors that the SRB will continue the reduction of Sales Tax rate on services to 13 percent, as done in fiscal year 2016-17, remained unrealized.

    “Although, investors appreciate that the Sales Tax rate in Sindh province at 13 percent is the lowest in the country, it remains higher than comparative regional tax rates.”

    The OICCI suggested that to keep in-line with the regional developing countries, reduction in sales tax on services should be made by 1 percent in the Sindh Finance Act 2020-2021 and gradually reduced to 10 percent over the next three years for registered entities, whilst the current rate should be maintained for unregistered entities.

    This will encourage registration to avail the benefits of input adjustment.

    The OICCI also suggested that the option to opt for the basic rate or normal regime should be given to all the service providers who fall under the reduced/fixed rate regime.

    This option will reduce the cost of doing business for recipient of services as lower tax is not available for input tax adjustment, the OICCI added.

  • Japan eases inspection for Pakistani mangoes

    Japan eases inspection for Pakistani mangoes

    ISLAMABAD: The Japanese government has eased inspection regime on import of mangoes from Pakistan, a statement said on Friday.

    The Japanese Ministry of Agriculture, Forestry & Fisheries eased inspection regime for mangoes from Pakistan.

    The Japanese ministry also lifted ban on import of animal casing from Pakistan with effect from May 21, 2020.

    The authorization has been issued by Japan’s Chief Veterinary Officer Kiyoyasu Ishi Kawa, says a press release received from Tokyo.

    Pakistan had been exporting animal casings to Japan since 1985 but the Animal Health Division at the Japanese Ministry of Agriculture, Forestry & Fisheries (MAFF) restricted import of animal casing from Pakistan to Japan in 2017 due to enhanced Animal Health Requirements (AHRs) related to disinfecting measures.

    This resulted in a complete ban on import of animal casings from Pakistan. The leading exporter of animal casing from Pakistan to Japan M/s United Casing Corporation, Lahore immediately improved their processing unit according to the new Japanese standardsfollowed by inspection of the facilities by a team of Japanese experts from MAFF in November 2017.

    However, the matter kept pending for over two years since the visit of Japanese professional delegation to Pakistan.

    According to Tahir Habib Cheema, Trade & Investment Officer at the Embassy of Pakistan in Tokyo, the Japanese Animal Health Division was re-engaged in January this year to resolve the matter by involving stakeholders from both sides.

    Satisfying all queries of Japanese authorities, the negotiations were successfully concluded in March, 2020 followed by a thorough exercise on drafting certificate templates.

    Efficiently achieving another milestone, Cheema has shared that MAFF has finally allowed import of animal casing from Pakistan with effect from May 21, 2020 while designating United Casing’s unit in Lahore as one of the Designated Salted Casing Facilities according to the Animal Health Requirements for salted natural casings to be exported to Japan from Pakistan.

    Trade between Pakistan and Japan has always been stagnant both in volume and variety; however, the Trade & Investment Section at the Embassy of Pakistan in Tokyo has been making significant efforts not only to develop new market in Japan for Pakistani products but also in reviving export of conventional products that faced restrictions due to various standardization requirements.

    At a time when global trade is facing a lot of challenges and countries like Pakistan are projecting dip in exports, such a news stimulating positive energy can be of great help in sustaining trade and economy, keeping the hope alive.

  • FPCCI demands elimination of discretionary powers of tax officials

    FPCCI demands elimination of discretionary powers of tax officials

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has demanded withdrawal of discretionary powers of tax officials including multiple selection of audit and entering business premises.

    Mian Anjum Nisar, President and Zakaria Usman, Convener, Budget Advisory Council of the FPCCI urged the FBR to withdraw the discretionary powers vested with the tax officials to avoid their misuse, provide relief to the taxpayers, simplify taxation law and restore the diminishing confidence of the assessees in the taxation laws – a pre-requisite for success of any scheme.

    The proposal is made as a part of the FPCCI presentation being made to the concerned quarters including Dr. Hafeez Shaikh, Advisor to the PM on Finance and Revenue, Razak Dawood, Adviser to PM for Commerce, Textile and Investment and Nausheen Javaid Amjad, Chairperson, FBR for incorporation in the forthcoming Federal Budget 2020-2021.

    He added that the FPCCI after identifying a series of such provisions vesting discretionary powers had given concrete proposals to safeguard the interest of the taxpayers against the misuse of discretionary powers.

    Regarding discretionary powers of conducting Multiple Audits / Amendment of Assessment under Sections 177, 214C and 122of Income Tax Ordinance, they elaborated, “Although a return filed, U/S 114 of ITO 2001, within time limit does qualify for Universal Self-Assessment Scheme (USAS) and considered to be Assessment Order deemed to have been passed U/S 120(1) of the Ordinance on the date of filing the return, but even then it may be amended as many times as may be necessary by the Inland Revenue officials within 5 years from the end of the financial year in which the return is filed which results in multiple tax assessments”.

    They therefore, proposed that the power to select the return of income may rest only with the FBR who is already having the powers to select the audit cases randomly through Computer U/S 214C of the Ordinance.

    However, they added, “In case where definite evidence is available with the department then the audit be initiated upto the transaction in question only”.

    These discretionary powers provide sufficient incentives to the Inland Revenue Officials to serve Audit Notices to the commercial importers and other such assessees who have already discharged their tax liability as full and final at the time of clearance of goods at customs stage and as such promote direct contact between a taxpayer and tax officials which is against the government policy as it encourage tax evasion and corruption.

    The FPCCI Chief Mian Anjum Nisar also lamented posting of Inland Revenue Officer at Business Premises under Section 40B of Sales Tax Act, 1990 to monitor production, sales of goods, stock position etc as it is out dated and unnecessary in the modern era of computerization and available methods of monitoring the entire production and supply chain.

    He argued, “It gives a perception of anti-business and anti-investment government policies, creates harassment and tantamount to revival of supervise clearance scheme of Central Excise in Sales Tax Act, 1990”.

  • Pakistan Business Council urges Sindh to reopen industries

    Pakistan Business Council urges Sindh to reopen industries

    KARACHI: Pakistan Business Council (PBC) has urged Sindh government to allow industries to reopen with surety of safety compliance to prevent coronavirus.

    In a letter to Sindh Chief Minister on Wednesday, PBC appreciated the proactive steps taken by your government to contain the spread of the Covid-19.

    No doubt countless lives have been saved. We also record our appreciation of the phased and safety driven manner in which your government has allowed economic activity to resume.

    Many of our members in food, pharmaceutical, iron and steel and export sectors in Sindh have demonstrated a heightened sense of responsibility to safe-work practices.

    There are anomalies between the sectors allowed to reopen by various provinces. These are working to the detriment of those with manufacturing facilities in Sindh.

    As a result, the Sindh based units are losing revenue and market share, whilst continuing to pay employees and incur fixed costs.

    A case in point is electronic appliance manufacturers which have been allowed to reopen in Punjab, whilst those in Sindh are still locked down.

    PBC advised the Sindh government to allow industries other than steel, cement and apparel to resume operations, conditional of course to compliance with the SOPs prescribed.

    Prolonged shutdown carries the risk of permanent closure of some undertakings and the consequent loss of jobs and revenue to the Government of Sindh.

    The Pakistan Business Council (PBC) is a private sector business policy advocacy forum composed of the largest businesses including multinationals operating in Pakistan.

    Its members contribute nearly 25 percent of the national tax revenue, generate 40 percent of annual exports and contribute every 9th rupee to Pakistan’s GDP.

    Members operate in nearly all sectors of the formal economy and many have a strong presence in Sindh.

  • Textile exporters demand extension in filing duty drawback claim

    Textile exporters demand extension in filing duty drawback claim

    KARACHI: Textile exporters have demanded the commerce ministry of allowing extension in filing claims for duty drawback up to July 31, 2020.

    Pakistan Hosiery Manufacturers Association (PHMA) in a statement on Tuesday said that the commerce ministry should consider extension in cut-off date of submission of incremental claims of Duty Drawback on Taxes (DDT) for the year 2018-2019 from May 31, 2020 to July 31, 2020.

    This will facilitate and enable textile exporters to submit their claims at convenience without hassle, in view of global business slowdown, lockdown amid COVID19 and reduced working hours for the last almost two months.

    Likewise, in current scenario and unprecedented set of challenges being confronting to the textile industry, the government should also consider and facilitate textile exporters by allowing them to submit remaining 50 percent incremental duty drawback of taxes claims under Duty Drawback Order 2018-21 on achievement of 10 percent increase during financial year 2019-2020 on the basis of nine months’ performance as export production remained standstill and suffered during a whole quarter due to lockdown amid corona pandemic.

    This imperative and favorable move by the government will facilitate textile exporters and it will boost their confidence to achieve extra mile beyond in enhancement of exports in succeeding years.

    In his letter to Abdul Razak Dawood, Advisor to Prime Minister on Commerce, Textile & Investment, Chaudhry Salamat Ali, Central Chairman PHMA has drawn his attention towards Ministry’s Notification No. 1(42-B)TID/18-TR-II dated 3rd August 2018 for Duty Drawback of Taxes Order 2018-2021 according to which the Government provided extension in Prime Minister’s Package of Incentives for Exporters in order to provide drawback of taxes collected from textile exporters.

    Duty Drawbacks on Taxes (DDT) under the Order shall be allowed for shipment made from 1st July 2018 to 30th June 2021 while the cut-off date for filing of claims for exports in each financial year shall be 31st July May of the subsequent year.

    Salamat Ali apprised that several member exporters approached informing that they have been facing inconvenience, amid economic slowdown and lockdown due to COVID19, to process and complete the procedural requirements as per Duty Drawback of Taxes Order 2018-2021 to submit their DDT incremental claims for the year 2018-2019 at Banks/Authorized dealers by cut-off date 31st May 2020 which is approaching very fast.

    Due to COVID19 textile industry of Pakistan was affected and remained totally closed for a period of around 50 days and industries resumed operations/ productions after special permission from the Government. Country has faced a complete lockdown situation from 23rd March 2020.

    In such a scenario, banks as well as SBP are open with reduced working hours and limited number of staff which has been causing delays. Last year the Ministry had also extended the cut-off date to 31st May 2019 to 31st July 2019, consequently, in view of current scenario, date of submission of DDT claims for year 2018-2019 must be extended from 31st May 2020 to 31st July 2020 with necessary advice to State Bank of Pakistan, accordingly.

    Salamat Ali added that economic slowdown in the wake of COVID19 has brought detrimental effects on the textile industry and exports of Pakistan. The Textile Export Industry has faced colossal financial losses due to cancellation of orders, delayed payments against LCs, disputes as some buyers refused to collect the export shipments at destinations.

    The textile industry resumed operations after two months acquiring special permission, nonetheless, supply chain remained disruptive due to closure of allied industry which provides supplies and materials to smoothly run the wheels of textile export industries.

  • PBC Advocates Abolishing Anti-Dumping Duty on Raw Material Used for Exports

    PBC Advocates Abolishing Anti-Dumping Duty on Raw Material Used for Exports

    KARACHI: Pakistan Business Council (PBC) has advocated abolishing anti-dumping duty on imported raw material that are used for export oriented units (EOU).

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  • OICCI lauds SECP for improving regulatory environment

    OICCI lauds SECP for improving regulatory environment

    KARACHI: The Overseas Investors Chamber of Commerce and Industry (OICCI) has praised Securities and Exchange Commission of Pakistan (SECP) for improving regulatory environment for registered entities.

    In a statement on Monday the OICCI felicitated the SECP on the Companies (Amendment) Ordinance, 2020 promulgated on April 30th.

    The Chamber, along with other leading business association, has in the past challenged some of the over-regulatory conditions introduced in the Companies Act 2017 without due engagement of the key stakeholders.

    The amendments to the Companies Act 2017, according to OICCI members, will further improve the regulatory environment in line with regional practices.

    Abdul Aleem, CE/Secretary General of the OICCI commenting on the amendments said: “foreign investors have always supported regulatory environment which are predictable, consistent and transparent.

    “The recent April 30th 2020 amendments to Companies Act 2017 had been under discussion between the SECP and other stakeholders, including OICCI during a series of “Consultative session and feedback” meetings held in 2018 and 2019 and acceptance of several recommendation should be a matter of satisfaction for business entities.”

    He further said ‘a few recommendations are still not part of the proposed amendments and we shall request SECP to also review these so as to attract sizeable FDI in these challenging, post COVID 19, global investment environment’.

    Pakistan’s FDI for past several years has been less than one percent of the GDP against the regional norm of 3 percent and above.

    Some of the key amendments in the Act which were challenged by the chamber, which have now been addressed in the amendments include; limiting the scope of the definition of “officer”, allowing a non-listed company to buy back its shares in line with the right already given to listed companies, doing away with the requirement for a ‘foreign national’ to hold National Tax Number as per the provisions of IT Ordinance, 2001, deletion of the clause where a director could be disqualified for a period up to five years if the affairs of the company have purportedly been conducted in a manner which has deprived the shareholders a reasonable return, deletion of the complete section whereby, inter-alia an independent director and a non-executive director were held liable in respect of some acts of omission or commission by a listed or a public sector company, deleting the personal liability of the Directors whereby they were required to make payments under certain circumstances including a situation where the return on the investments was not according to certain criteria, doing away with the impractical provision to deposit any unclaimed or unpaid amount to the credit of the Federal Government, introduction of a ten percent shareholding threshold in the much debated section on Companies’ Global Register of Beneficial Ownership and deletion of the section requiring security clearance before appointment of Directors.

    A key matter recommended by OICCI, and other stakeholders, to delete the reference to ‘lineal ascendants and descendants’ from the ambit of related parties has not been addressed and OICCI has again requested SECP to review this important matter.

    “Negative perception of Pakistan among potential foreign investors has been a key impediment in attracting sizeable FDI in the country. Pakistan’s rating in the World Bank Ease of Doing Business has only recently improved to 108 from being 147 in 2018 and needs much more business friendly measures to attract its due share of the global/regional FDI, ”Aleem concluded.

  • Karachi Chamber demands lifting lockdown completely as corona cases rise above 40,000

    Karachi Chamber demands lifting lockdown completely as corona cases rise above 40,000

    KARACHI: Business community has demanded complete ease in lockdown on Sunday as cases of coronavirus have increased to over 40,000 in the country.

    The government has started easing lockdown since last Monday but the cases of coronavirus increase at faster pace. The corona cases have increased to 40,151 till May 17, 2020.

    Chairman Businessmen Group (BMG) & Former President Karachi Chamber of Commerce & Industry (KCCI) Siraj Kassam Teli in a statement urged the Sindh Government to completely do away with the ongoing lockdown at least during the last week of Ramadan ul Mubarak in which all the shops and shopping malls be permitted to operate 24-hours a day, which would not only help in dealing with the overcrowding issue at various commercial markets due to limited timings but would enable the small traders/ shopkeepers to recover some of the previous losses suffered by them because of the prolonged lockdown that began from March 23.

    Siraj Teli stressed that the lockdown has to be completely relaxed during the last six days from Monday to Saturday before Eid so that Karachiites could visit commercial markets without any hassle, haste or worries while the shopkeepers could also deal with their customers in an uncrowded atmosphere which was really needed to ensure social distancing, one of the key precautionary measure required to effectively contain further spread of coronavirus pandemic.

    “Subsequently, the lockdown can once again be fully re-imposed during Eid-ul-Fitr holidays and up to May 31 as announced by Sindh Government and from June 1, 2020 onwards, the Sindh government, after reviewing the overall situation, may follow the same formula in which small traders/ shopkeepers are allowed to operate for four days a week from Monday to Thursday and the lockdown remains active on Friday, Saturday and Sunday.

    While appreciating numerous steps taken by Sindh Government since the imposition of lockdown to prevent spread of coronavirus pandemic particularly the hard work by Chief Minister Syed Murad Ali Shah, Chairman BMG regretted that it was really unfortunate to see that during last week when the lockdown was eased, small traders and shopkeepers breached their commitments made to Sindh Government by grossly ignoring the mutually agreed Standard Operating Procedures (SOPs).

    “The Karachi Chamber, being the premier Chamber and actual representative of the entire business & Industrial community, is not only too concerned about the losses suffered by small traders, shopkeepers and the industrialists but also equally worried about the lives of the masses as we cannot afford to run our businesses at the cost of the lives of the innocent public, who could become victim of the life-threatening virus anytime, hence it is the moral and social responsibility of everyone to adopt the SOPs”, Siraj Teli said, while appealing the Small Traders and Shopkeepers from each and every commercial market across Karachi to strictly adhere to all the SOPs at any cost during the remaining days of the ongoing shopping season of Eid ul Fitr as any negligence towards these SOPs would create a disastrous situation, which was already too bad as the number of COVID-19 infected people continues to rise across the country.

    “Meanwhile, the citizens must also be very careful and take necessary precautionary measures so that we all could collectively battle against the life threatening coronavirus pandemic and save our beloved country from further disaster”, he added.

    Siraj Teli further commented, “Since day one, I have been reiterating that Coronavirus is not going to go anywhere and it is going to stay with us for the time being. It has become part of our lives and we will have to live with it. We cannot afford to keep the businesses closed forever so the government and the business community will have to jointly devise ways and means of how to safely get back to daily routine life in the presence of the virus.”

    He was of the opinion that all the SOPs were not just limited to the shopping season of Ramadan only but these must become part of our daily lives and routine business activities.

    He said, “The Sindh government has strived really hard during the last almost two months to contain the spread of coronavirus pandemic. We cannot put all these efforts at stake hence, the shopkeepers must strictly ensure social distancing and take precautionary measures within and outside their business premises which is not only in favor of their own lives and businesses but also in the larger interest of the country. Every single life is very important so we all have to maintain strict discipline and adopt the SOPs which would help us in continuing our businesses in the presence of the virus”.