LAHORE - Lahore Chamber of Commerce and Industry on Monday called for barter trade with Iran, as smuggling is not only widening the trade deficit but also causing huge loss to the exchequer.
LCCI President Farooq Iftikhar was talking to a 10-member Pakistan Plastic Manufacturers Association delegation that called on him under the leadership of LCCI Executive Committee Member Mahmood Gazanvi and comprising Executive Committee Member S M Tariq, the Association’s President Muhammad shoaib and others.
He said the government did not need to go to IMF or World Bank for funds if smuggling was controlled, adding that smuggling of plastic moulding compound and finished products from Iran had pushed the plastic trade and industry to the verge of closure, while, a large number of businessmen attached with plastic business were now planning to shift their businesses to other countries.
After energy shortage, he said, the smuggling had now started taking its toll on businesses. Therefore, government should utilize all available resources to weed out this menace, besides starting barter trade with Iran to eliminate smuggling.
The LCCI President also sought the FBR (Federal Board of Revenue) chairman’s help and urged him to bring down rate of Sales Tax to 5 percent from 16 percent on Plastic moulding compound, adding that it enable the government to generate more revenue, as due to higher tax rate much of the money was going into the pocket of smugglers who were thriving at the cost of country.
He said that a considerable surge in smuggling from Iran had been reported after US sanctions. Therefore, to save the plastic industry and its trade from a total collapse, the government should immediately start barter trade with Iran.
While, the PPMA President Muhammad Shoaib said at only because of huge smuggling, finished plastic products were available in the local market at Rs 20 per kg below the raw material price that was very damaging for the local businessmen.
He said the total import of plastic raw material Polyethene and Polyproplene in 2011-2012 was about Rs 100 billion. The importers pay advance tax at port about 35 percent in lieu of duties and taxes and if the smuggling was not stopped, it would lead to a loss of minimum Rs 35 billion to the exchequer.