APFMA wants ST exemption for Pakistan-based foam makers

President of All Pakistan Foam Manufactures Association (APFMA), Nawaz Jadoon, has urged the chairman of Federal Board of Revenue (FBR) to ensure level playing field for all manufacturing sectors and exempt Pakistan-based foam manufactures from sales tax.
In a letter to the FBR chairman, he said, there exists a marked difference between the packages of sales tax being charged from the non-exempted segment of foam manufacturers who are based in Pakistan, as compared to the tax being recovered from the exempted segment of Azad Jammu and Kashmir (AJK)-based foam manufactures.
"Non-exempted sector of foam manufactures are paying 17 percent sales tax, 3.40 percent tax on value addition, 2.40 percent extra tax and 2.40 percent further tax or 25.20 percent in the aggregate," he said, comparing that exempted group of foam manufactures are paying only 17 percent sales tax which is refundable after 5 years by AJK and Gadoon Amazei.
Jadoon further said exempted group pays 17 percent tax at import state and subsequently take refund whereas non-exempted group pays 17% which is non-refundable. He said the companies based in Pakistan cannot afford to pay 8.20% tax in the head of value addition, extra tax and father tax when the exempted group is not paying a single penny on this account. He said Pakistan-based non-exempted group which is in minority and manufactures only 22% of total production and requirement of foam in Pakistan, cannot run their factories and survive due to huge tax.
"The goods produced in Azad Kashmir are smuggled into Pakistan and AJK-based manufacturers are not paying any sales tax on goods which are sold outside AJK, he said, adding that the result of this discrimination in the tax rate is that many companies of non-exempted group already closed down their units in Pakistan and the remaining ones are struggling to operate and would shut down in near future.
APFMA president said treatment to non-exempted group is clearly discriminatory, against the fundamental rights of equality before law and non-discrimination and freedom of business and profession guaranteed to them under article 4, 18, 24 and 25 of the Constitution of Pakistan as well as against the principles of justice.