KARACHI, FEB 16 /DNA/ – Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has welcomed the Sindh government’s decision to reduce the infrastructure development cess, terming it a historic breakthrough that is expected to reduce the cost of doing business by hundreds of millions of dollars annually.

Mr. Atif Ikram Sheikh lauded the provincial government for lowering the cess from the existing 1.85 per cent to a bracket of 0.80pc to 0.85pc. He noted that the business community had been struggling with this issue for the past 20 years; and, the resolution marks a significant relief for trade and industry.

Mr. Atif Ikram Sheikh further highlighted that the infrastructure cess on the Export Facilitation Scheme (EFS) has been completely abolished, fulfilling a major demand of exporters. The FPCCI’s prolonged struggle has finally borne fruit, providing much-needed fiscal space to the trading community, he added.

Elaborating on the financial implications, FPCCI’s Senior Vice President Saquib Fayyaz Magoon, disclosed that approximately Rs350 billion related to the Sindh Infrastructure Development Cess is currently tied up in court cases. Under the new arrangement, traders who withdraw their cases will be offered a structured payment plan.

Mr. Saquib Fayyaz Magoon, SVP FPCCI, elaborating upon relief for withdrawal of cases, traders will be required to pay 15pc of the outstanding amount by July 31, 2026; another 15pc by October 31, 2026; and a further 15pc by July 31, 2027. He noted that the reduction in the cess by one per cent would significantly ease the liquidity burden on importers.

Mr. Abdul Mohamin Khan, VP FPCCI and Regional Chairman Sindh, expressed gratitude to Sindh government representatives – specifically Mr. Mukesh Kumar Chawla, Mr. Zia ul Hassan Lanjar and Mr. Murtaza Wahab, for their role in facilitating the agreement.

Mr. Abdul Mohamin Khan detailed the long-term settlement plan for the backlog, stating that after the initial 45pc payment has been made over the next year and a half, the remaining 55pc of the outstanding cess will be payable over a 12-year period, spanning from 2028 to 2040. This measure will not only cut costs but will also expedite the clearance process at ports, he observed.

Mr. Asif Sakhi, VP FPCCI, clarified the differential rates applicable under the new regime. He stated that for traders with pending court cases who opt for the settlement, the new cess rate will be 0.85pc; whereas, for those without litigation, the rate will be fixed at 0.80pc.

The FPCCI leadership expressed hope that the Sindh government would continue to support the industrial sector with similar business-friendly initiatives in the future.