KARACHI - The Overseas Investors Chamber of Commerce & Industry (OICCI) has recommended that the Corporate Tax Rate should be capped at 30% for all companies, presently being charged at 35% in Pakistan. The OICIC presented its federal budget proposals for the forthcoming fiscal year to concerned authorities aimed at increasing growth and investment into Pakistan The OICCI emphasized the need to broaden the tax base and reduce the rate and multiplicity of taxes.   In its budget proposals formulated for 2008-09, the OICCI highlighted that Corporate Taxes are very high in Pakistan as compared to other developing and developed markets in the region. Corporate Tax is charged at a rate of 28% in Malaysia, 29.7% in Korea, 30% in Indonesia, 33% in China and 33.6% in India. The Chamber pointed out that Federal Excise Duty (FED) in most countries is imposed to regulate and discourage consumption of items that are considered injurious to health, such as cigarettes and alcohols. However, FED is still being levied on basic consumer products, which the OICCI proposed should be removed, said OICCI budget document. Similarly, it has been proposed that companies should be provided an option of Presumptive Tax Regime (PTR) or NTR for their manufacturing/import/contract execution business. This relief is in line with the same relief that has been given to large trading houses. It is also recommended that the government should abolish the concept of value addition, as it is not as per the true concept of recoverability of sales tax in VAT mode. OICCI has proposed the withdrawal of Withholding Tax on stock exchange transactions, as it will eliminate the chances of misuse by various individuals and financers. Similarly, it is recommended that marginal tax relief should be introduced by the government against preset criteria for the salaried class in order to avoid extra burden of tax due to nominal increase in remuneration. The OICCI has also proposed that the third schedule of the Sales Tax Act should be deleted, as it obliges companies to suffer the sales tax on sales price, which does not pertain to the company, thereby eroding the true concept of sales tax law. The manufacturing sector in Pakistan faces - in addition to conventional taxation - taxes on account of Workers Profit Participation Fund (WPFF) and Workers Welfare Fund (WWF) which increases "cost of doing business" thus making their products less competitive with importers.  The OICCI proposed elimination of WPFF in its entirety or its utilization through a fund (just like a provident fund) for the benefit of workers to build schools, hospitals etc. (as 95% of the contribution on account of WPFF goes to the government after allocation to the workers). The intent of levying taxes on these two accounts discourages existing manufacturing concerns from expanding their businesses and also discourages foreign investors from setting up manufacturing operations.