The Overseas Investors Chamber of Commerce of Industry (OICCI) has asked the government to give more tax relief to the corporate sector.
According to the OICCI, the government needs to streamline the unreasonably high taxes on the corporate sector following the introduction of new taxes including the Super Tax thereby effectively increasing the tax on organized businesses to over 40 percent, the highest in the region.
Commenting on the International Monetary Fund’s (IMF) $3 billion bailout for Pakistan, OICCI President Amir Paracha has complimented Prime Minister Shehbaz Sharif and his Finance team for securing the deal.
Separately, the OICCI President underlined the need to boost the revenue base of the country by aggressively broadening the tax base, reduction in governance costs, and reforms in all the key state institutions including the revenue authorities, SOE, and the regulatory bodies both at the federal and provincial level.
Together with IMF’s rapid lending of US$ 1.2 billion, the friendly countries have also helped uplift the Foreign Exchange reserves, thereby providing a significant step towards economic stability and progress. This sentiment is reflected in the developments at Pakistan Stock Exchange, the currency market, and the business environment in general, he said.
OICCI members also appreciated the upgrade of Pakistan’s long-term foreign currency Issuer Default Rating (IDR) to ‘CCC’ from ‘CCC-’ by Fitch Ratings. Pakistan Bonds in the international market have also rallied post the announcement.
While OICCI members remain concerned due to long pending remittances of dividends and other charges, as responsible foreign investors who have been operating in Pakistan for over 75 years, the chamber is supportive of the government’s actions and looks forward to a gradual easing of the strict controls on imports and remittances.
“In conclusion”, Amir Paracha added, “Pakistan is attracting insignificant FDI well below its potential, whereas OICCI members continue to add substantial investment in Pakistan and over the past ten years have invested over $22 billion in expanding their footprint in Pakistan. OICCI members will continue to be sincere long-term partners by positively supporting the government in realizing the economic and investment potential of the country”.
