SMEs apprehensive of tax & duty levies warn policy makers not to make mistake

May 31, 2024 |

The Financial Daily 31/5/24
The Union of Small and Medium Enterprises (UNISAME) being apprehensive about increase in taxes has informed Nadia Seth , the general manager policy and planning of the Small and Medium Enterprises Development Authority (SMEDA) of the adverse consequences and urged her to warn the government of impeding economic disaster.
President UNISAME Zulfikar Thaver said the sector is badly affected by the inflation, high cost of energy and import duties on their raw and packing materials and if the policy makers as apprehended decide to levy more taxes and duties the sector will be crippled.
Thaver urged SMEDA to impress upon the government not to impose any more taxes on income or duties on raw and packing material and to consider that the SMEs are in no position to be burdened any more. The salaried class has also lost buying power and doing without much of their requirements which has affected the SME units sales. If the salaried is taxed further it will indirectly affect SME units and they will be compelled to reduce production. Some may even have to close down.
Hussain Ali convener logistics said the freight rates are high due to high risk of war and violence in the seas making imports and exports both costlier due to diversion and adoption of longer routes. This makes the goods unaffordable and noncompetitive.
Salman Merchant convener e_commerce said the SMEs are unable to compete with neighbouring countries who are well facilitated and enjoying benefits whereas Pakistani merchants selling online have to route their businesses via Dubai and pay commissions and charges to intermediaries.
Shaukat Ali convener banking said it is unfortunate that no currency swap or agreements have been activated or implemented with Iran which is an handsome market for SMEs. The SME units are facing tough competition from smuggled consumer goods in the market.
Hassan Ibrahim convener alternate energy lamented that instead of promoting solar energy the government is mulling to reduce the buy/sell back of electricity to the grid and making it difficult for the SME units.
The Unisame Council ( UC) members emphasized that there is no room for any tax or increase of duty in the budget and it would be unwise of the government to impose any further tax or duties.
UC members have advised the government to increase the tax net, curb smuggling and get after the tax evaders, profiteers, hoarders and mafia who misdeclare values and goods on invoices to save duties. They are blood suckers and need to be dealt with iron hand.

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