Budget 2021-22 helps motivate industries, businesses and SMEs

• Enormous facilities for industrial growth and large consumption of manpower provided

Interview with Mr Zafar Iqbal — a businessman/an industrialist/an educationist

PAGE: Tell me something about yourself, please:

Zafar Iqbal: I am Founder President of Small & Medium Enterprises Alliance (SAMEA) which was inaugurated on 20^th March 2000 by Mr. Shaukat Aziz, the then Finance Minister and Prime Minister of Pakistan. I have been highlighting in TV interviews and at various important forums the problems faced by the SMEs and I also present suggestions for the improvement and the development of the SMEs such as the establishment of industrial parks for the SMEs where all facilities such as land, electricity, gas, water, internet facilities should be provided for successful operation of SMEs at low cost. I am also Founder President of Defence Residents Society, the President Society for the Promotion of Arabic and Bazm-e-Kiran/Society for the Prevention of Waywardness.

PAGE: What are your views on the Federal Budget 2021-22?

Zafar Iqbal: The incentives given to industries, businesses and SMEs are favorable which will prove helpful for the promotion of industrial and business activities. The Budget presented has corrective measures in the taxation system such as aberrations, distributions, errors, policy mistakes are highlighted and wherever possible corrected. The revised definition of smuggling and if successfully controlled it is hoped Pakistan will enter a newer paradigm of growth. In the budget, an amount of about US$56 billion is for imports while our exports are expected to exceed US$30 billions about similar amount is expected to be received from the overseas Pakistanis, so there will be considerable saving of the US dollars. We must observe austerity in every department and avoid import of all those products, which are made in Pakistan to save hard-earned dollars. Manufacturing of cell phones and restriction on Hajj by Saudi Government will result in colossal savings of foreign currencies, which can be utilized for payment of foreign loans to reduce the burden of loans. We should also reduce heavy reliance on home remittances. Deletion of 12 withholding taxes is a good decision and will be conducive to economic growth and activities.

Now I would like to mention about some harsh burdensome proposals in the budget.

At least three budgetary proposals for recovering extra funds are impracticable including collection of withholding tax on domestic electricity bills, sales tax from sugar on retail price basis and huge amount of 38 billion rupees as additional revenue from crude oil. If above taxes are implemented there will be tremendous burden on the people which will result in huge protest, anger and will also create problems for petroleum exploration companies, which will now have to pay sales tax on crude oil sold by them. The zero rating to the supplies to petroleum companies is also proposed to be withdrawn. There are several reasons why small traders, SMEs and ordinary persons avoid registering under tax net. It is mainly due to fear of harassment, black mailing and also because persons belonging to SMEs have little education and do not know the use of computers internet to comply difficult rules regulations in English language.

The public has witnessed and is also aggrieved that tax payers’ money is not spent on their needs for providing the basic amenities such as adequate supply of water, electricity, gas, medical facilities, transport, good education at low and affordable cost while tax payers’ money is mainly spent on luxurious, comfortable welfare of the very large number of government functionaries and servants which is visible from their life styles. Austerity measures are not mentioned in the budget. There is no focus in the budget about the development of fisheries’ export which can generate huge amount of dollars if proper care, incentives, improvement of hygienic conditions and modernized procedures requirements are provided to the backward industry. Provisions of empowerment of IR officers to arrest any person on the charges of concealment of income should be re-examined and withdrawn immediately as it is causing fear, harassment, mistrust to tax payers and also to prospective tax payers on one side government efforts are to generate maximum amount of taxes on the other. It is mind boggling that in the new budget 15 institutions are exempted from payment of income tax and filing of annual tax returns in which some non-serving organizations and all political parties registered with ECP are included which is unprecedented.

PAGE: What kind of performance could we witness in the industry in the wake of the Federal Budget 2021-22?

Zafar Iqbal: With unprecedented concessions and incentives, facilities provided to various industries such as Textile, Pharmaceuticals, Construction, Information Technology, SMEs Sector etc. will be encouraged to perform better.

PAGE: Could you tell us about the infrastructure in the industrial areas and measures taken in the Federal Budget 2021-22?

Zafar Iqbal: The enormous facilities have been provided in the budget for the expansion of infrastructure in various industrial sectors which will help and facilitate industrial growth and large consumption of manpower in the likely expanding sectors of various industries. This will help to reduce unemployment in the country.