Zonal Chairman Pakistan Readymade Garments Manufacturers and Exporters Association terms Federal budget as a balanced one

Karachi, June 13, 2013 (PPI-OT): The Zonal Chairman PRGMEA, Mr. Shaikh Mohammad Shafiq has termed the Federal budget as a balanced one. He said that the proposal to reduce corporate income tax rate by 1% is appreciable. He also appreciated Minister’s announcement that the corporate income tax will be reduced to 30%, in phases, over next four years. He, however, said that the increase in the sales tax from 16% to 17% will have inflationary effect on consumers.

He said that the overall burden due to this increase will have about 5% on prices of items. On the import side this will give rise to under invoicing and smuggling of goods. He also welcomed the various austerity measure proposed in the budget and said that enhancing the tax-to-GDP ratio to 15 percent, from the current 8.9%, in the next five years is a positive sign.

The Chairman said that the industry appreciates governments’ resolve to tackle circular debt and energy issues, however, no concrete plan in this regards is announced by the government. He said that the availability of electricity and gas is a priority for the industry and the government should come up with solid action plan to tackle this issue. Moreover, reforms regarding water, infrastructure development and social uplift are commendable. He said that the budget will instill confidence in the business community and it is expected that it will encourage substantial national and foreign investment.

For more information, contact:
Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA)
18-A Shaheen View Building, Block-VI, P.E.C.H.S.,
Karachi-75400, Pakistan
Tel: +9221 3454 9073, +9221 3454 7912
Fax: +9221 3453 9669
Email: info@prgmea.org
Web: www.prgmea.org