close
Tuesday May 21, 2024

SMEDA calls for duty reduction to 3pc, lower taxes to boost SME Growth

The objective of the session was to engage with stakeholders and gather recommendations

By Our Orrespondent
April 05, 2024
This representational image, People work at their stations at an incubation center in Lahore. — AFP/File
This representational image, People work at their stations at an incubation center in Lahore. — AFP/File

LAHORE: The Small and Medium Enterprises Development Authority (SMEDA) has proposed comprehensive reforms, including a cut in duties to 3 percent, single-digit SME taxes and sales tax, and interest rates lowered to 10-15 percent, to support SME growth.These proposals were discussed at the first pre-budget 2024-25 consultative session held at SMEDA's head office on Thursday.

The objective of the session was to engage with stakeholders and gather recommendations to shape the fiscal policy of the country, particularly focusing on incentivizing SME growth, promoting new enterprise creation, and enhancing the scale of businesses across Pakistan.

The general manager of Policy and Planning at SMEDA, Nadia Jahangir Seth, opened the session with an overview of SMEDA’s unwavering commitment to serving as a bridge between the SME sector and the government.

Seth emphasised SMEDA’s role as the apex SME development body and highlighted the importance of continued collaboration between stakeholders to drive inclusive economic growth and prosperity for SMEs in the country.

During the session, stakeholders from various sectors, including the Federation of Pakistan Chamber of Commerce & Industry (FPCCI), Lahore Chamber of Commerce & Industry (LCCI), Quetta Chamber of Commerce and Industry (QCCI), Sarhad Chamber of Commerce and Industry (SCCI), Women Chambers of Commerce & Industry (WCCI), and other private sector representatives, actively participated in discussions and deliberations, and

provided valuable input for framing proposals for tax facilitation and business growth.

A wide array of recommendations and challenges were discussed, reflecting the diverse needs and concerns of the SME sector."Key recommendations focused on tax policies, the burden on businesses vis-à-vis compliance, and the urgent need for government support. Stakeholders advocated for minimizing duties to 3 percent, implementing single-digit taxes on SMEs, reducing sales tax to a single digit, and lowering interest rates on loans to a range of 10-15 percent," a statement said.

"Additionally, stakeholders highlighted the detrimental impact of smuggling on law-abiding SMEs and proposed measures to tackle red tape at all levels."The session also underscored the importance of strategic planning for fiscal policy, with an emphasis on solutions-oriented approaches to address challenges. The stakeholders also emphasized the need for streamlining documentation processes for businesses to facilitate ease of doing business.

Furthermore, representatives of various stakeholders, including FPCCI, LCCI, KCCI, Chain Store Association of Pakistan, and others, also emphasized the significance of a long-term fiscal policy roadmap aligned with political and IMF programs. Discussions centered around the need for reassessing the current economic vision and the importance of industry mapping to identify key areas for intervention and growth.

Earlier, SMEDA proactively solicited proposals from SME stakeholders nationwide, focusing on fiscal measures, direct and indirect taxes, compliance issues, and federal and provincial levies. These proposals will be submitted to the Ministry of Industries and Production, Ministry of Finance, and the Federal Board of Revenue for inclusion in the federal budget 2024-25.