The budget 2020-21 has no focus on changing economic priorities : FPCCI

Lahore : The budget 2020-21 is a traditional budget, which has no focus on changing economic priorities, “said by Mian Anjum Nisar, President Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in FPCCI Post Budget Press Conference here on monday.

He said that it’s a recession situation and targets could not be achieved. Last year budget targets were revised thrice while Agriculture Sector was there to support GDP which was about 6.4%. This year locus has also affected Agriculture sector. Preparing a ‘balanced’ budget in the midst of coronavirus epidemic which has already inflicted a Rs 3 trillion loss on country’s Gross Domestic Product (GDP) or economy was no joke.

While the government must be praised for setting a modest but realistic growth target for the next fiscal year 2020-21, the revenue collection target appears to be more unrealistic than what was set for fiscal year 2019-20.

He said the demand for restoring the zero-rating facility and proposals of the textile export sector has been disregarded. There is no support/ policy for SMEs the most vulnerable sector under current crisis. CNIC issue is not resolved. Sale tax rate not reduced. Corporate tax and Turnover
Tax were not reduced.

No clear cut policy on demurrage has been announced. No time is fixed for deciding appeals as appeals are pending for decision for the last three years. Rate of Turnover Tax and Withholding Tax for Distributors not reduced. Rate of tax for Small and Medium
Enterprises (SME) not reduced. Minimum Tax @ 1.5% U/S 113(i) (e) and (2)(c) not reduced.

The time period of Records keeping of 6 years – section 174 not reduced. Non separation of Judicial System from Tax Collection Machinery.

Dr. Muhammad Arshad said further Sales Tax not eliminated. There is discrimination in Sales Tax on Commercial & Industrial Importers is not done away with. R.D and Additional Customs Duty is not eliminated. No relief in Income Tax Rate has been shown.

He also said that personally I did not expect much from this Budget because it has only announced as a customary. He also said that resources are scarce and issues are critical. We should request our international community for remittance and special monetary or any other kind of aid to overcome this special situation. Agriculture is also affected by locus drastically. We have to wait and see for the results of this budget. Better understanding of budget will be after having complete budget feature.

Mian Anjum Nisar also highlighted few positive aspects of the budget i.e. Exemption of additional custom duties on those tariff lines which are now @ 0% customs duty in tariff. 2. Reduction of custom duty on 40 raw materials of various industries. 3. Tariff rationalization under National Tariff Policy 2019, by reducing customs duty on 90 tariff lines from 11% to 3% and 0%. 4. Reduction in regulatory duty from 12.5% and 17.5% to 6% and 11%, respectively on Hot Rolled Coils (HRC) of Iron and steel falling under PCT codes 7208 and 7225& 7226, respectively.5.

A number of industrial inputs/intermediary raw materials are being allowed concessional import under new serial number of the fifth schedule through IOCO quota On the other hand issues pertaining commerce and trade are concerned still are outstanding and could have been addressed in this budget included ease of doing business still has room for the improvement, amid pandemic COVID-19 government has neglected major portion of sectors though have considered cement Industry and has increased capital gain which is admirable.