Business community not happy with tax raise, oil price hike

September 1, 2013 Off By Web Desk

Karachi: The economic managers need to bring about a positive change in the level of production of goods and services in the country over the next couple of months to overcome the crisis, said Union of Small and Medium Enterprises UNISAME at a meeting of their mentor committee here on Sunday.

President UNISAME Zulfikar Thaver said economists insist that real growth is nominal growth minus inflation. Economic growth is usually brought about by technological innovation and positive external forces and no efforts are visible in this direction. He said the business community is terribly disappointed as increasing taxes and prices of petroleum products is no excuse to overcome the economic crisis and what is needed is economic expertise to put the economic growth back on trail.

A study of our economy is needed to understand its working and the importance of the majority SME sector and its strengthening.

The fall of the rupee is making the industry uncompetitive and the argument that it will increase exports is baseless as figuratively the exports will show an increase but not in volume. The exchange rate temporarily enables the exporters to fetch more Pak rupees for a dollar but the gain is offset by increase in the price of raw materials and cost of transportation.

With most of the industrial units closed due to law and order and load shedding the production loss is huge and the business community is surprised that the new government which was claiming to resolve the issues is showing no signs of concern.

Corruption has increased in all the government departments and the rates for different kinds of services have been increased and the officials are demanding more indicating that there is hyper inflation in the country and their salaries are insufficient.

The union demanded of the government to facilitate commerce and industry by first and foremost controlling law and order and secondly ensuring the supply of uninterrupted energy and thirdly by financing farming, manufacturing, trading and services systematically to enable them grow and remain competitive.

The imposition of import duties on alternate energy devices, farm equipments and inputs, raw materials of export oriented industries and import substitution industries lacks comprehension and the economy managers need to seek help of economist to understand the nature of our economy.

The union said that International Monetary Fund IMF advises increase in taxation to increase revenue because the government fails to reduce its own expenses but increase in taxes and prices of fuel is killing the economic growth and squeezing the common man.