KARACHI: President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Irfan Iqbal Sheikh has expressed concern over lack of facilitation and fair environment for distributors and merchants of industrial raw materials, who play a vital role in growth of exports as well as import substitution.
Speaking at a meeting with large-scale stakeholders from the platform of Pakistan Chemical and Dyes Merchants Association (PCDMA) at the Federation House, Sheikh maintained that chemical merchants must be brought into the Normal Tax Regime (NTR) from the Minimum Tax Regime (MTR), in which they were put about two years ago after being removed from the Final Tax Regime (FTR).
He proposed that in order to fight the menace of flying invoices in the sector, the condition of customer CNIC copy should be waived and the turnover tax should be brought down to 1.0 percent immediately, from the current 1.25 percent.
Going forward, it should be brought down to 0.5 percent gradually, he said.
The FPCCI chief explained that the traders and middlemen in the industrial raw material supply chain must be facilitated as they are the ones who help keep the wheel of industrial production turning. They support export-oriented industries to meet consignment deadlines, assist in establishing new industries and contribute to preserving precious foreign exchange reserves through import substitution.
Mr Sheikh emphasised that government departments have been neglecting merchants of industrial raw materials, even though they should be facilitated more than importers of luxury goods like cars, mobile phones, branded clothing, and high-end food products.
Kamran Riaz Bharara, the chairman of PCDMA, said the imposition of 4.5 percent Withholding Tax (WHT) on sales by middlemen in the supply chain of the industrial raw materials, who buy from the commercial importers, is counterproductive as it raises the cost of doing business and squeezes the profit margins even further.
This is a substantial impediment in the government’s efforts to establish a robust, efficient and reliable supply chain for the industries.
Copyright Business Recorder, 2022
Comments
Comments are closed.