ISLAMABAD - The Islamabad Chamber of Commerce & Industry (ICCI) has rejected the imposition of 10 per cent super tax by the government on the corporate sector as it would have a serious impact on the large scale industries besides sending negative signals to the potential local and foreign investors.
It called upon the government to immediately withdraw super tax to save the industrial sector from further troubles. Muhammad Shakeel Munir, President, ICCI, said that the corporate sector was already paying 29 percent tax and providing employment to a large number of people, but the imposition of 10 percent super tax would put a cumulative burden of 39 percent tax on it, which would not be affordable for it. He said the ultimate burden of super tax on cement, steel, banking, airlines, textile, automobile, sugar mills, beverages, oil & gas, fertilizer, cigarettes, chemicals and LNG would be passed on to the end consumers and bring a new wave of high inflation in the country. He said that this measure would discourage the potential investors for investing in Pakistan, dry up local & foreign investment and badly affect the expansion of business ventures in the country. ICCI president said that the government has already taken some very harsh measures like historic hike in the prices of petroleum products and utility tariffs, increase in policy interest rate to 13.75 percent, which have caused a big surge in the cost of doing business and made the private sector very uncompetitive. The imposition of a super tax would badly affect the growth of the corporate sector and instead of improving the economy, it would plunge the economy into a deep recession. Jamshaid Akhtar Sheikh, Senior Vice President, and Muhammad Faheem Khan, Vice President ICCI, said that instead of putting high tax burden on the existing taxpayers in one budget, the government should adopt a gradual approach for rationalization of taxes and focus on broadening the tax base in order to improve the tax revenue of the country. They stressed that the government should always consult with the stakeholders before taking such harsh measures to save the economy from further problems as unilateral tax measures will destroy the businesses, reduce their competitiveness and fuel the inflation like never before through its multiplier effect.