Govt urged not to succumb to IMF pressure

KARACHI: President of United Business Group (UBG), Zubair Tufail has said that the government should not mortgage the national economy by succumbing to IMF pressure and accepting all its conditions verbatim.

He emphasised that justice must be done to all sectors of the economy; otherwise, the resulting deterioration in economic conditions will be beyond the control of the current or any future government.

He called for an end to measures against the textile sector, which is the largest employment provider after exports and agriculture. It appears that the government has decided to shirk its responsibilities.

He urged the Finance Minister to visit the FPCCI head office and meet with representatives of the affected business sectors to address their issues promptly.

During a discussion with former Senior Vice President of FPCCI Mazhar Ali Nasir, former Vice President Shakeel Ahmed Dhingra, UBG spokesperson Gulzar Feroz, and other businessmen, Zubair Tufail mentioned that following the announcement of the federal budget for the new fiscal year 2024-2025, a new wave of inflation has emerged across the country from July 1. Prices of all goods have skyrocketed, heralding an economic storm for the national economy.

Zubair Tufail said that no business sector in the country is satisfied with the federal budget. The abundance of taxes has caused distress for everyone. The business community is also extremely worried about how they will bear the burden of undue taxes, with many sectors facing double taxation.

The new budget is extremely disappointing for exporters, who bring in the most foreign exchange for the country. The construction sector and petroleum dealers have threatened to go on strike by shutting down their businesses. Prices of all commodities have increased in the markets, and exporters have rejected the end of the “Final Tax Regime.”

He mentioned that industries using electricity as raw material are already burdened with record-high unit costs. In such circumstances, the decision to impose fixed charges should be reversed. The government should immediately address the anomalies in the federal budget and find better solutions.

He stated that the indiscriminate taxes imposed on food items in the federal budget have caused a sharp increase in their prices. The public will be crushed by the inflation created by the new federal finance minister, as the prices of lentils, meat, gram flour, powdered milk, oil, ghee, spices, and all other items have reached the highest levels in history.

Zubair Tufail further stated that the IT sector is like a bright chapter in Pakistan’s economy. The General Sales Tax (GST) on essential IT hardware for computers has been increased from 5% to 10%, which will significantly raise the cost of necessary technology. This increase will affect both new and existing IT companies.

Zubair Tufail mentioned that the recent increase in petroleum product prices will have extremely negative effects on industrial production and will further increase the prices of almost all household items, so this increase should also be reversed.