Chairman Indenters Association of Pakistan (IAP), Khurram Sayed and FPCCI Standing Committee on Customs Chairman Saquib Fayyaz Magoon have urged Sindh Chief Minister, Syed Qaim Ali Shah and the Provincial Finance Minister Syed Murad Ali Shah to consider their one-point demand and exempt indenter services from levy of service tax.
They also urged a meeting with the Sindh Chief Minister to apprise him of their concerns that, service tax must not be levied on indenters as they provide services to their foreign principals and in return earn a commission and precious foreign exchange for the country. They said the indenters are bitter as the Sindh Government did not withdraw service tax on indenters in the provincial budget 2016-17. In the budget, they pointed out that instead of encouraging indenters as in other export oriented sectors the Sindh Government last year had imposed an unjust service tax.
Indenters get quantity discount from foreign suppliers and save foreign exchange and then get back this amount as commission in foreign exchange. So it's our demand that indenters should be in tax free regime like other exporters and relieving them from domain of provincial government.
Khurram Sayed and Saquib Fayyaz Magoon said, that after several meetings with Sindh Revenue Board (SRB) officials that were held in a cordial atmosphere and always ending on a positive note - they were expecting that in the provincial budget 2016-17 service tax would be withdrawn on indenting service providers, but they are perturbed that the Sindh Government has yet not withdrawn service tax on indentors. They further said, mostly indenters deal in raw materials for industries and are a source for supplying quality goods to manufacturing and export sectors to ensure smooth production of industries.
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