The government unveils a plan to reduce rising production costs

Commerce Secretary Addresses Tariff Issues, Promises Support for SMEs and Job Creation

LAHORE:
Federal Commerce Minister Jam Kamal Khan announced that the government has developed a detailed plan to tackle rising production costs and strengthen Pakistan’s manufacturing sector.

In his address to the business community at the Lahore Chamber of Commerce and Industry (LCCI), Khan on Wednesday emphasized the need for a supportive business environment to reduce unemployment and encourage SMEs.

He reaffirmed the role of the Ministry of Commerce in staying connected with the business community to identify and address their issues, with a focus on trade, exports, imports, manufacturing and tariff competitiveness.

Khan recognized the need to address issues such as circular debt, IMF conditionality and institutional inefficiencies affecting consumers.

He assured that Prime Minister Shehbaz Sharif is committed to involving key stakeholders in resolving economic issues.

LCCI President Kashif Anwar welcomed the minister and highlighted the challenges faced by businesses including inflation, currency depreciation, rising energy costs, high interest rates and higher freight costs.

Anwar noted that recent SROs (457, 350, 1842) have increased the tax burden on registered individuals.

Anwar proposed a revised tariff structure with 0% duties on basic materials, 5-10% on intermediate goods and higher rates on intermediate and consumer goods to simplify the duty system.

He also recommended reducing excise duties on machinery and semi-finished products to promote technological progress.

He stressed the importance of exploring untapped markets such as Africa, Central Asia and ASEAN countries to boost exports.

Besides textiles, rice and leather, Anwar highlighted potential sectors such as halal food, pharmaceuticals, IT and engineering. He also discussed the implementation of a barter mechanism with Iran, Afghanistan and Russia through SRO-642, expressing hope for better trade with neighboring countries.

The minister warned that overburdening companies with taxes could reduce business activity and government revenues.

He called on the Tariff Board to focus on business rather than tax collection, adding that the Ministry of Commerce will join the anomaly committee to ensure that concerns of the business community are addressed.