Govt plans tax cut for small businesses

KARACHI: The government has planned several tax exemptions and special incentive package for small- and medium-sized enterprises, the finance minister said on Saturday a move aimed to achieve five percent growth target set for the current fiscal year.

Finance Minister Shaukat Tarin said sectors such as housing, information technology and trade needed a special focus to achieve a five percent growth.

Tarin was speaking at the inauguration ceremony of “Kamyab Jawan Markaz” at Karachi Chamber of Commerce & Industry (KCCI).

“The government would not leave the low income group to rely on trickle down affect from the growth in major sectors, but would adopt bottom-up approach, and Kamyab Jawan programme was part of that strategy,” he added.

The finance minister also announced to expand the scope of Kamyab Pakistan programme across the country, which is presently operative in Balochistan and Khyber Pakhtunkhwa to provide interest free loans to farmers, low-interest loans for housing, Sihat card, etc.

“Rs120-140 billion will be kept in every year budget for Kamyab Pakistan programme,” he said.

Responding to complaints of members of KCCI about raids by the Federal Board of Revenue (FBR) on retailers in Karachi, Tarin said he had taken notice of the raids. He mentioned that only two million people pay the income tax, and termed it not a positive sign for the country. The minister disclosed that the government had collected the data about income of people to calculate the accurate income tax, which ought to be paid.

“Independent auditors will scrutinize cases if there is any dispute to the tax demanded by the government against the income.”

About the retail sector, Tarin revealed that total worth of the sector was Rs18-20 trillion, but around Rs16 trillion of retailers were out of tax net, which would be brought in the tax net, he said.

The minister also shared that Rs20 billion were kept for drawback on local taxes and levies (DLTL) scheme, which were raised to Rs100 billion after he assumed the charge of the finance ministry.

Earlier, special assistant to PM on Youth Affairs Usman Dar stated that 5000 shops would be opened in Karachi next month under Kamyab Jawan Programme, adding, 25000 businesses had been set up under the scheme with a disbursement of Rs33 billion in the country.

Dar gave the credit to Tarin on bringing substantial changes in the programme after he took charge of the ministry of finance.