KARACHI: Hardly five days after the ‘tax-free’ budget for 2012-13 went into effect, the Sindh Industry Department has sent new proposals for enhancing land taxes by 40 to 50 per cent.

These proposals suggest increase in annual rent of the plots from Rs7,500 t Rs10,000 and transfer of plot fee for built-up plant from Rs600,000 to Rs800,000 and from Rs700,000 to Rs1,200,000 for an open plot.

A finance committee comprising representatives of Sindh Industrial Trading Estate (SITE Ltd) and Site industrialists will be meeting on July 12 to discuss these proposals.

The Industry Department also proposed jacking up of amalgamation (joining) fee of plots to Rs200,000 from Rs100,000 and the drawing fee for building plans of industries to Rs4 per sq feet from Rs3.

The managing director of SITE Ltd refused to comment on the new tax proposals but sources in the department said that enhanced tax rates had been proposed for the Site industries in view of the all-round increase in maintenance and development expenditures.

The SITE Ltd has no money to carryout maintenance and development expenditures of the Site area, which is the largest industrial estate of the country. The land tax rates were enhanced only two years ago in 2010.

Site Association of Industry (SAI) Chairman Irfan Moten while talking to this reporter strongly opposed to the increase in land tax rates in view of dilapidating state of industries for the last many years due to severe electricity and gas load-shedding and worst law and order situation.

He added that the poor business environment had not only discouraged fresh investment in Site area but compelled many entrepreneurs to close their factories. About 1,300 to 1,500 units have closed down while others are struggling for survival.

He said many industries mostly textile had shifted to Bangladesh, Malaysia and South Africa and the number of units in Site, which is the country’s largest industrial estate, had reduced from 3,500 to 2,000 units.