FEBR asks govt to facilitate businesses thru cut in tax rate on oil products
The Friends of Economic & Business Reforms (FEBR) President Kashif Anwar has urged the government to facilitate the industry through a reduction in the tax rate on petroleum products, besides decreasing electricity tariffs as well as lowering the markup rate, as the country’s economy is going through a challenging phase.
He said that at a time when the GDP ratio was very nominal amidst the high cost of doing business, the industry needs maximum support and relief. He lamented that the GST on petroleum products has been increased to 4.77 per cent from 1.63 per cent on petrol, while the HSD rate was also increased to 9.08 per cent from 7.37 per cent. It is unfortunate that the Petroleum levy on petrol is raised to Rs 17.62 per litre and on HSD is also revised from Rs 13.14 to Rs 17.14 per litre.
The business leader said that the government has made an unprecedented increase in the ratio of tax, duty and Petroleum Levi ostensibly to earn billion of rupees in revenue. He said that inflation is on the higher side due to the impact of the government’s economic policies of soaring fuel rates, enhancing power and gas tariffs and depreciating the local currency.
He called for uninterrupted and low-cost gas supply to the industrial sector, urging the government to upgrade the transmission and distribution systems to ensure a continuous and smooth supply of electricity and gas. He urged the government not to tolerate any laxity towards the up-gradation of gas and power transmission and distribution systems, as any negligence could cause unbearable loss to the trade and industry. He said that gas and electricity are basic ingredients for the industrial sector and are a must to keep the wheel of industry moving. He said that the growth of the local industry is a barometer of the economy.
Kashif Anwar observed that business-friendly policies should be adopted as other neighbouring countries of the region are giving to the industry. He said that a sizeable cut in oil rates would certainly bring down the cost of doing business and our products would get their due share in the global market.
He called upon the government to address the key issues of trade and industry, facilitate economic growth along with improving the tax revenue of the government. He said that the impact of COVID-19 has badly affected the business and industrial sector, stressing the government to bring down GST in order to ease the difficulties of businesses.
He said that the move would reduce the cost of doing business, attract new investment, promote industrialization and create new jobs.
He said that oil prices and inflation are closely connected in a cause-and-effect relationship. As fuel rates move up, inflation, which is the measure of general price trends throughout the economy, follows in the same direction upward.
Instead of providing subsidies or waivers, it is unjust to overburden the industries with a hike in the cost of production. An increase in petroleum products costs will further weaken the economic environment which is already under threat on various fronts.