KARACHI, June 26: A seminar was organized by the Institute of Cost and Management Accountants of Pakistan (ICMAP) on Saturday, where the salient features of the Finance Act 2004-05 were discussed.

Speakers admitted that overall the budgetary measures were 'investors-friendly and growth oriented', but urged that structure imbalances in the country's fiscal scenario should be addressed, to reduce the debt servicing burden.

Government's resolve to say goodbye to IMF and other donor agencies was a big step forward, but some of the speakers stated that debt servicing as shown in the 2004-05 budget had increased in absolute terms, which was eroding country's financial sovereignty.

The chief guest at the Seminar, Shahid Ahmed, Member, Sales Tax, Central Board of Revenue, affirmed that government was making all possible efforts to bring more and more people into the tax net.

"It is a matter of common knowledge that a large number of people are earning a lot but not paying any tax," he observed.

He emphasised that the government needs more and more resources urgently to develop infrastructure so as to create jobs and alleviate poverty, and added that only an effective tax net could solve this problem.

Khawaja Tanveer Ahmed, collector, Sales Tax Enforcement, CBR, appreciated the reforms being initiated in tax collecting institution such as the customs and the CBR. The chairman, SITE Association of Industry, Muhammad Nisar Sheikhani, thought it was good that government had focused on cutting cost of doing business.

However, he pointed out that business community's demand of zero per cent duty on the import of machinery had been skipped. He welcomed the measures and incentives offered by the government to promote small and medium enterprises culture. He was not satisfied with the cut in power rates by 58 paisa for industrial sector and thought it to be too little.

He was of the opinion that elimination of customs duty and sales tax on varnishes and paints, though forming just 7-7.5 per cent share in a project, would nonetheless, boost housing industry.

Professor, Applied Economics Research Centre, Dr Shahida Wizarat, appreciated government's efforts to improve taxation procedure and to upgrade dispute resolutions system. She also shared her thoughts with the audience on advance tax payments, presumptive tax regimes, etc.

Syed Asad Ali Shah, Chartered and Management Accountant said, "For job creation and poverty alleviation we should invest more in labour-intensive projects." There was a wide gap between the skills needed and skills available, he added.

Vice President, Engr. M. A. Jabbar, FPCCI appreciated incentives given to agriculture and industry. He, however, said that the allocation for social sectors and development projects were inadequate. "The allocations for health and education is merely 0.5 per cent of the GDP, which is less than many underdeveloped countries of the world", he observed.

Earlier Chairman Karachi Branch Council of Institute of Cost and Management Accountants of Pakistan Muhammad Ashraf, FCMA, welcomed the guests and said that the appellate authority should be separated from the CBR. His view was that it better be placed under judiciary.