KARACHI: The Pakistan Broadcasters Association (PBA) and the All Pakistan Newspapers Society (APNS) have raised serious objections to a recent amendment introduced in the finance bill, which they argue could significantly burden large multinational corporations operating in Pakistan.
The amendment specifically targets sales & promotion and advertisement expenses, restricting their eligibility for adjustment in income tax returns to 25 per cent of a company’s total expenditure.
In letters addressed separately to Prime Minister Shehbaz Sharif and Finance Minister Muhammad Aurangzeb on Saturday, both media associations underscored the detrimental impact this amendment could have on their members. They cited ongoing challenges faced by PBA and APNS due to economic contraction, lack of innovation, and overall sluggish economic growth.
“Our members are under constant pressure, have reached an optimal point, and cannot face a further decline in our business”, said the letters, adding that the “consequence of further decline means unemployment due to closure of small media channels [and] newspapers and its eventual negative impact on the overall community.”
Highlighting the broader economic implications, the associations expressed concerns that Pakistan’s already high effective tax rates, compounded by the proposed amendment, could discourage foreign direct investment (FDI) and undermine the country’s attractiveness as an investment destination. They emphasized the need for policies that support sustainable economic growth rather than impede it.
Both PBA and APNS said that they “understand the challenges being faced by our government and therefore, support the government in its efforts for documenting [the] economy and highlighting the positive steps being taken by all stakeholders. We are also cognizant that the economic slowdown is unavoidable and requires patience and resilience from every section of society, which includes our members, their staff and workers and we continue to highlight positivity.” They added that, while “acknowledging the above challenges, and our commitment to stand on the front line with the state and government, we expect that rationale will prevail.”
The letters also criticized the lack of prior consultation with industry stakeholders and questioned the retrospective nature and rationale behind the amendment, arguing that it fails to align with global best practices.
Highlighting the fact that “multinationals are already walking on thin ice, when compared to the opportunities in other regional countries and keeping them engaged is the responsibility of all of us”, the letters noted that “those who stayed with us for [the] last many decades should not be punished, for short-term gains by increasing their cost of doing business and adopting kneejerk measures to collect revenue”. Both media associations have urged the government to reconsider the amendment, given its potentially devastating impact.
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