The Pakistan Business Forum (PBF) has put forth a comprehensive set of proposals urging tax authorities to undertake significant reforms aimed at curbing under-invoicing by commercial importers and fostering industrial growth.
These proposals, submitted to the Ministry of Finance for consideration in the forthcoming budget for the fiscal year 2024-25, encompass a wide range of measures aimed at reducing the cost of doing business, strengthening the agriculture sector, promoting export-led growth, and enhancing tax efficiency.
One of the primary concerns highlighted by the PBF is the rampant under-invoicing practices prevalent among commercial importers, which have been detrimental to domestic industries. The forum emphasizes the need for strict measures to address this issue and calls for special provisions in the budget to tackle under-invoicing effectively.
Khawaja Mehboob ur Rehman, President of the PBF, stresses the importance of mechanization and technology adoption to enhance productivity and efficiency in various sectors. The forum recommends solid incentives to be introduced in the federal budget to encourage the adoption of modern technologies and practices.
In the agriculture sector, the PBF advocates for improvements in irrigation systems, water management practices, and access to high-quality seeds and fertilizers to boost crop yields and productivity. The forum proposes the establishment of mechanisms between the federal government and provincial governments to address these issues effectively.
Furthermore, the PBF underscores the importance of supply chain management in reducing post-harvest losses and enhancing market access for agricultural products. It suggests increasing access to credit and insurance facilities for farmers to mitigate risks and invest in their operations, with special instructions to be given to designated banks.
Research and development (R&D) in agriculture are also highlighted as crucial areas for investment. The PBF recommends allocating special funds in the federal budget for institutions such as the Pakistan Agricultural Research Council (PARC) and the National Agricultural Research Centre (NARC) to undertake research projects aimed at improving crop yields, disease resistance, and climate resilience.
To promote export-led growth, the PBF calls for improved market access and trade agreements, along with measures to simplify export processes and provide incentives for exporters. The forum suggests the introduction of tax holidays for the setup of machinery, such as Control Atmosphere (CA) stores, to encourage value addition and increase the share of horticulture and agricultural exports.
Tax reforms are also a focal point of the PBF’s proposals, with recommendations to simplify the tax system, rationalize tax rates, and eliminate distortions and exemptions. The forum advocates for the automation of tax processes to reduce human interaction and minimize the risk of corruption.
Additionally, the PBF proposes the abolition of withholding taxes to ease the burden on businesses and individuals, including the elimination of withholding tax on cash withdrawal. Tariff reductions on raw materials and machinery are suggested to encourage industrial growth and exports.
The forum also addresses issues related to customs duties, documentation, and the misuse of transit trade agreements, emphasizing the need for legislative amendments and stricter enforcement measures.
In conclusion, the PBF’s proposals offer a comprehensive roadmap for tax reforms and policy measures aimed at promoting sustainable economic growth, enhancing competitiveness, and addressing key challenges facing Pakistan’s business and industrial sectors. As the government prepares to finalize the budget for the upcoming fiscal year, stakeholders will be closely monitoring the implementation of these recommendations to realize their full potential in driving economic development and prosperity.