February 23, 2016
Pakistan Businessmen and Intellectuals Forum (PBIF) President Mian Zahid Hussain on Tuesday said volatile international oil market has emerged as a great threat for oil importing countries which can face serious consequences.
Oil cannot recover before 2017 therefore oil producing countries should reengineer tax system, impose new taxes and abolish subsidies to improve their falling GDP and save the world from another crisis, he said.
Mian Zahid Hussain who is also President AKIA, First Vice Chairman of the Businessmen Panel of FPCCI and former Provincial Minister said that oil producing nations has seen seventy percent fall in their incomes while Arab and North African countries have suffered a loss of 340 billion dollars last year which amounts to twenty percent of their GDP.
Talking to Chairman of Pakistan Overseas Employment Promoters Association Ch. Muhammad Afzal and others, he said that time has come for the oil exporters to reconsider layoffs and introduce value-added tax, corporate tax, excise duty, property tax and tax on all the incomes except for remittances.
He said that developing countries including Pakistan are heavily dependent upon remittances therefore downturn in Arab nations is not affordable to them, Saudi Arabia which is facing a loss of Rs 100 billion dollars can default by 2020, according to IMF projections.
The veteran business leader said that GCC countries have lost 500 billion dollars in one year which should act as a wake-up call to push oil importing countries to brace for the situation, reduce expenditures and deficit and improve income through tax reforms and exports.
Government should cut non-developmental expenditure, abolish subsidies, downsize state-run organisations and take other necessary steps. Export sector should be equipped with latest trends and outdated elements lest the situation become out of control and result in bankruptcy of the country, he warned.