Daily Times

ISLAMABAD: The All Pakistan Business Forum (APBF) has asked the government to introduce reforms to make business workings easier.

This has been requested in the context of annual ranking of countries with the ease by which they conduct their business activities according to the World Bank’s Doing Business Report.

APBF President Ibrahim Qureshi said that Pakistan had slipped three places on the World Bank’s Ease of Doing Business Index and now ranks 147th among 190 economies, denouncing the government’s claim of pro-business image of the country. He said that the index was mostly used as a guide by foreign investors to learn more about a country, aiding decisions on pouring in money into the economy.

“It is unfortunate that the country slipped from its last year’s rating despite the introduction of some reforms in areas of starting a business and making international trade relatively easier,” he said, adding that the finance ministry mainly be blamed for the overall poor performance, as the country’s ranking declined on the indicators of paying taxes and getting credits. Pakistan lost 16 positions on the indicator of paying taxes, standing at 172, according to the 2018 report. Last year, Pakistan’s ranking was 156. One of the reasons behind the dismal performance was the increase in overall tax rates that surged to 33.8 percent of total profits.

The APBF president said that instead of broadening the tax base, the government relied heavily on the existing extremely narrow tax base to meet its additional revenue requirements. This made business uncompetitive. Although the government reduced the overall corporate tax rate to 30 percent, it imposed Super Tax on big companies that jacked up tax contributions.

The report noted that Pakistan implemented some business reforms in 2017, making it easier to register a new business, transfer commercial property and facilitate cross-border trade. Pakistan is among those South Asian economies that carried out around 20 business reforms in the past year, bringing to a total of 127 the number of reforms enacted in the region over the past 15 years, says the report, which monitors the ease of business activities for small and medium-enterprises around the world. “We have to take up a huge challenge to implement the reforms on creating an enabling business environment at federal level. It is appreciated that the Board of Investment and the SECP are committed to implement reforms for a well-documented economy and a formal growing business sector,” the business leader said.

He said that due to the government’s growing budget financing needs, very little capital has been left for the business to expand. Moreover, the country did not make any progress on the issue of reliability of supply and transparency in electricity tariffs. Survey results show that despite the government’s focus on the energy sector the people perceptions did not change.

Published in Daily Times, February 17^th 2018.