BMP Urges Government to Address Budget's Lack of Trade and Industry Incentives

Relaxing import policy for industrial raw materials and paying early refunds to solve the liquidity crunch

BMP Urges Government to Address Budget's Lack of Trade and Industry Incentives
Islamabad: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI)'s Businessmen Panel (BMP) has urged the government to address anomalies in the 2024-25 budget before its passage by parliament, highlighting the lack of incentives for trade and industry.
Mian Anjum Nisar, former FPCCI president and BMP Chairman, emphasized the importance of solving issues faced by traders through consultation, noting that BMP's mission is to create a stable economy and a prosperous business community. He criticized the budget for its lack of reforms and logic, although he acknowledged that some difficult steps were taken under IMF pressure.
Nisar called for promoting industrialization and enhancing exports by lowering production costs, paying early refunds to alleviate liquidity crunch, and relaxing import policies for industrial raw materials. He suggested a growth-oriented budget with significant tax reductions to help revive businesses.
The BMP leader mentioned that his group had finalized budget proposals in consultation with the business community across Pakistan and submitted them to relevant departments. However, these proposals were not implemented. He stressed the need for reforming and simplifying the taxation system in consultation with real stakeholders, with a focus on providing relief to documented and registered SMEs.
Nisar criticized the Federal Board of Revenue (FBR) for its arm-twisting tactics, including raids on business premises, which he said discouraged people from filing tax returns. He urged the government to work closely with the business community to broaden the tax base and increase the tax-to-GDP ratio, as the number of active taxpayers has declined.
He also criticized the hike in salaries of government employees, which he said would significantly burden the national exchequer amid a severe fiscal situation. Nisar questioned how the administration justified this salary increase given the country's high interest payments.
Commenting on the federal budget, Nisar noted that it seemed similar to previous budgets, with the government aiming for fiscal consolidation without drastic measures. He acknowledged the government's intention for a gradual and modest economic recovery aligned with IMF guidelines but questioned the achievability of the revenue target of Rs12.9 trillion.
Nisar predicted that the new taxation measures would negatively impact the country's exports and questioned the legality of the federal excise duty on real estate. He suggested that the government should have unveiled a long-term plan for expanding the tax net in phases.
In conclusion, Nisar expressed hope that the steps taken in the federal budget 2024-25 would pave the way for a long-term IMF plan, helping stabilize the currency and control inflation. However, he criticized the budget for its lack of incentives and logical measures to support trade and industry.