Millat Tractors to challenge FBR’s Rs18bn sales tax demand

One of Pakistan’s leading tractor manufacturers, Millat Tractors Limited, on Monday rebuked the Federal Board of Revenue (FBR) over a Rs18 billion sales tax demand, terming it “unrealistic and illegal”.

In a notice to the Pakistan Stock Exchange (PSX), Millat said it shall avail all appellate forums to contest the FBR’s order.

“This refers to the news published in Business Recorder regarding the order of Rs18 billion in respect of Sales Tax liabilities and penalties by FBR.

“The said order is related to the disclosure made on June 24, 2024,” it said.

Business Recorder on Monday reported that FBR has raised a huge sales tax demand of Rs18 billion against a leading tractor manufacturing company in line with the implementation order of President Asif Ali Zardari.

“The FBR has timely implemented an order of the President and completed an audit of the said company, resulting in sales tax demand of Rs18 billion,” stated the report.

The FBR has also confirmed to the President of Pakistan that the quasi-judicial /adjudication proceedings have been finalized against the said Lahore-based company. In this regard, Large Taxpayer Office (LTO), Lahore has submitted an implementation report dated January 25, 2025 to the President of Pakistan through the Federal Tax Ombudsman (FTO).

President Zardari has directed the FTO to submit the final compliance report and explanation of the queries raised by the President in the said audit case of the Lahore-based company.

Meanwhile, Millat Tractors, in its notice on Monday, rebuked the federal tax collecting authority, saying that the FBR “in an endeavour to meet unrealistic tax targets has instead of broadening the tax base, relied on raising unrealistic and illegal demands from existing taxpayers”.

It further warned that such actions would hurt businesses and the current investment climate.

“The company shall avail all appellate forums to contest the order and is confident that justice will prevail,” the company concluded.