Government set to slap hefty tax on retailers
Pakistan has informed the International Monetary Fund (IMF) that it is planning to impose an indicative income-based tax on retailers aimed at increasing their contribution in the range of Rs100 billion to Rs200 billion per annum.
Tax Authorities have shared broader contours of the proposal with the IMF, which the interim government wants to implement with effect from January next year, according to government sources.
No specific collection figure has been shared with the IMF but assessment shows that roughly an additional Rs9 billion to Rs20 billion per month can be collected from the retailers through a fixed tax on shops, they said.
Pakistan explores lates avenues of collaboration
Nineteen Pakistani exhibitors are participating in the ongoing 6th China International Import Expo (CIIE) being held from November 5 to 10 in Shanghai, which has made a remarkable mark by showcasing Pakistan’s largest effort ever.
The Expo, which has been held annually since 2018, is a major platform for promoting international trade and cooperation.
“Pakistan’s active participation in this event highlights its commitment to strengthening economic ties with China, Pakistan’s second largest export destination, and exploring new avenues of collaboration,” highlighted Pakistan’s Consul General in Shanghai Hussain Haider in an interview with the China Economic Net at a Pakistani pavilion.
Exports to Europe decline despite GSP Plus
Pakistan’s exports to European nations witnessed a 12.13 percent decline in the first quarter of the current fiscal year compared to the same period last year, primarily due to a reduced demand for Pakistani goods in western and northern Europe.
The Export revenue from these countries fell to $1.929 billion in July-September FY24, a noticeable drop from the $2.212bn recorded in the corresponding months of the previous year, according to figures compiled by the State Bank of Pakistan.
This Development underscores the challenges faced by Pakistani exporters in these economically uncertain times despite having preferential access to 27-member EU countries.
Arif for collective efforts to address economic ills
President Dr Arif Alvi has underscored the need for all stakeholders to make collective efforts to address the chronic social and economic issues in the country, which are impacting the national economy.
He was speaking at the Achievement Recognition Ceremony 2023 at the President House where the Lahore Chamber of Commerce and Industry (LCCI) recognised the services of top 12 companies. The president called on the private sector including industrialists and traders to come forward and share responsibility by uplifting the plight of the downtrodden strata of society, besides lending a helping hand to resolve the issue of about 28 million out-of-school children.
“Vulnerable people should be provided with education and health facilities so that they could get equal opportunities as such models are being followed across the globe,” he stressed.
PSX touches new heights
The Pakistan Stock Exchange (PSX) hit a new all-time high and crossed the 55,000 points barrier for the first time in history while the local currency slumped to a five-week low of Rs287.5 against the US dollar in the inter-bank market during morning trading hours on Friday.
PSX benchmark KSE-100 Index touched 55,268 points, soaring by 1.85 percent or over 1,000 points in intra-day trade from Wednesday’s close at 54,261.42 points.
This is the third consecutive working day the market has soared to a new high in intra-day trading.
Pak-Kuwait Investment Company, Head of Research, Samiullah Tariq said the “market has maintained the winning spree in the wake of sharp drop in cut-off yield (rate of return) on 3-year and 5-year government debt securities namely Pakistan Investment Bonds (PIBs), giving hope the central bank may cut its key policy rate sooner than expected earlier”.
IB Capital Market DFIs can drive growth
The Caretaker Federal Minister for Finance, Revenue & Economic Affairs, Dr Shamshad Akhtar, highlighted the pivotal role that Development Finance Institutions (DFIs) with expertise, efficiency, and flexibility can play in driving growth and development in the capital market. Chairing a meeting with the chairman of the Securities and Exchange Commission of Pakistan (SECP) and heads of DFIs, Akhtar reviewed the progress made on the establishment of a Private Equity and Venture Capital (PE & VC) Fund.
In a commitment made during a meeting on September 30, 2023, DFIs had pledged to launch a PE & VC Fund, positioning it as a catalyst for economic revival. The finance minister reiterated the significance of this initiative, stating that it aims to invigorate the investment landscape, providing essential resources for start-ups and SMEs to foster their growth. This move not only leverages the potential of capital markets to diversify financing sources but also strengthens the overall economic outlook.
Punjab exempts IT sector from smog restrictions
The Punjab government has responded to the urgent plea of the Pakistan Software Houses Association for IT & ITeS (P@SHA) by exempting the IT sector, including call centres and international IT centres, from the recent smog-related restrictions.
In a move to mitigate unintended consequences on various businesses, the Punjab government, through order NO.SO(G)/P&SHD/4-1/2023, has incorporated paragraph 4(e)(1) to exempt call centres and international IT centres. The order specifies exemptions for businesses in closed areas, encompassing a range of essential services.