In order to improve the effective use of taxpayer’s money, it is important that tax harmonization is carried out and tax incentives should be coupled with transparency documents so that people can really trust the government when they pay their taxes.

The statement was made by Dr Vaqar Ahmed, Joint Executive Director, Sustainable Development Policy Institute (SDPI) while speaking at a public-private dialogue on “Business Regulatory Environment in Newly Merged Districts, Khyber Pakhtunkhwa” organized by SDPI. He said that sustainable development needs resources and resources cannot be generated if people do not trust the government.

Talking about the newly merged districts he said that “under-development of these areas offered a lot of opportunities for trade growth and business. Harmonization of business activities in these merged districts and the upgradation of technology in agriculture, transport and warehousing are needed for the people of these areas to really make a profit. Also, when economic activity will take pace, a lot of micro level benefits will ensue for these people.”

Member Provincial Assembly of Khyber Pakhtunkhwa, Syed Ghazi Ghazan Jamal said that “it is important to shift the energy infrastructure of these areas to renewables. Since, sooner or later we have to make this transition. It is an inevitable process. Therefore, instead of spending money on distribution networks and expensive grids, government should encourage investors to come in and install renewable sources of energy. In that way, the region as a whole will move into the future without waiting for another break. This will also lift the financial burden from the people of these areas who already have low levels of income as compared to national average.”

Dr Sebastian Paust, Counsellor and Head of Development Cooperation, Embassy of the Federal Republic of Germany for his part said that “Germany is very interested in developing the technical capacity of Pakistan’s social and scientific institutions. Pakistan lacks business consistent policies. This really scares the investors off. Pakistan needs to work on our recommendations so that business can be brought into Pakistan.”

While speaking at the event Adnan Jalil Executive Member, Peshawar Chamber of Small Traders and Industries said that “newly merged districts need to be provided with the sum of money promised in the National Finance Commission. This money is crucial for developing the infrastructure destroyed in the war on terror. Also, policy measures by the government need to be adopted after taking the input of local businesses and leaders.” He further said that this will encourage local entrepreneurs and businesses to invest rather than taking the route of CSR activities. He also encouraged the government to expand horizons from Afghanistan and increase cooperation with Central Asian states.  

Sohail Jan from SMEDA told the audience that SMEDA has dispersed the assistance through USAID projects in the newly merged districts for supporting business activities. He pointed out a financing gap by informing that in response to 40,000 applications received, SMEDA has only managed to disperse $3 million in grants. He pointed out that these districts are confronted with internet connectivity challenges, lack of adequate micro-financing network, and insufficient banking infrastructure, which create obstacles to strengthening the business environment.

Nazish Afraz who is the Program Economist at SEED said that it is important to simplify the process of registration and acquisition of grants. This, otherwise, becomes a lengthy process which reduces growth. She said that targeted fiscal and financial incentives should be given to local entrepreneurs. Local capacity building is also very important in long-term sustainable growth. Local solutions to local problems should be sought.

Talking about investments from abroad Haider Asfandyar said that many states in the Gulf and Europe like Italy were very interested in developing the agriculture and food-processing sectors and marble industry of the region. He said that “it is important to connect the local producers with big suppliers so that their product can be packaged for export-quality. The strategic location of these areas is full of potential for connectivity  purposes. A lot of income can be earned by developing the infrastructure needed for connecting various regions through crossings in these areas. An environment of positivity is needed to formally incorporate these areas in the mainstream business activities.”

Fazal Karim, Deputy Collector, Khyber Pakhtunkhwa Revenue Authority (KPRA) recommended against the extension of tax exemptions granted in these districts to create a level playing field for businesses and to counter the dominance of non-local business entities. He further said that uniform taxes will encourage formalization and documentation of businesses and their transactions.

Sana Khan from Planning and Development Department Khyber Pakhtunkhwa said that master plans for these districts are under deliberation and will improve the business environment of the areas. She suggested creating awareness among locals on the potential positive impacts of land-use interventions in terms of economic and employment development in these areas.

Credit : Independent News Pakistan-WealthPk