ISLAMABAD, July 20: The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel (BMP) has urged the government to slash current expenditures and raise revenue from direct taxes, which still account for less than 35% of all projected collections as per the budget 2022-23.

In a statement issued on Wednesday, FPCCI former president and BMP Chairman Mian Anjum Nisar suggested that the government utilise available monetary policy tools wisely, stressing the need to adopt a holistic approach to develop all economic, agricultural and industrial sectors. He said there is a need to devise a comprehensive strategy to promote the industry on immediate basis which will not only support manufacturing sector but also help increase exports. He hoped that the government would pursue radical economic reforms through a long-term stable administrative set-up.

Nisar called for raising revenue through direct taxes. He suggested that the government cut current expenditures through reforms in all major sectors. “These measures will not only decrease pressure to generate higher revenue from indirect taxes, like petroleum levy, but also decrease the need to take external loans,” he said.

Nisar demanded the government introduce special package of power and gas tariffs for rapid industrial growth. “As a result of high tariffs and taxation, cost of production is increasing and Pakistan’s industry cannot compete in global market, which in turn hampers our exports,” he said.

Moreover, it is essential to have an agricultural policy that increases the supply of raw material to agro-based industries, both domestic and foreign, so that it can help domestic textile producers regain lost competitiveness in the world market, he added.

He said that Moody’s projection that the central bank would continue to increase policy rate over 2022 because of ongoing elevated inflationary pressures is worrisome. He said the rise in policy rate will impact the input costs of the large-scale manufacturing sector which is a significant contributor to the country’s GDP.

Credits: INP-WealthPk