The strike of customs clearing agents for four consecutive days against the levy of 1% Infrastructure Development Cess (IDC) by Khyber Pakhtunkhwa government had paralysed customs clearance process at Peshawar Dry Port and the number of stuck-up containers loaded with imported goods climbed to 120.
The provincial government of Khyber Pakhtunkhwa has levied 1% IDC on value +taxes on the clearance of goods at dry port as compare to 0.9% and 1% by the provincial governments of Sindh and Punjab. But the levy is only on value of goods while in Khyber Pakhtunkhwa the tax has been imposed on value addition and taxes.
Frontier Customs Agents Group (FCAG), a local association of the clearing agents is protesting the levy and demanding the withdrawal of the decision or at least bringing it at par with other provinces. Talking to this scribe president FCAG, Khyber Pakhtunkhwa, Zia-ul-Haq Sarhadi criticized the provincial government for the imposition of the infrastructure development cess and termed it a tantamount to double taxation, which is unconstitutional. He said that instead of providing incentives to the business community of the terrorism affected province, the provincial government is out to further overburden them. He demanded the withdrawal of the levy of the 1% IDC with immediate effect. He vowed that their strike will continue till the acceptance of their demands by the provincial government.
On the other hand the strike of the clearing agents is also affecting revenue collection of Pakistan Customs. Talking to this scribe, Deputy Collector (DC) Customs Peshawar Dry Port, Mohammad Zakir said that daily 10 to 20 containers are arriving in the dry port. He said that due to the strike of the clearing agents, the number of the stuck up containers had climbed to 120.
Concerned of the stock piling of containers, he said that the prolonging of the strike will create space problem in the dry port and collecting of revenue will be halted. Such kind of situation, he said will build up pressure on customs for the clearing of goods. The strike, he said had halted revenue collecting for last four days, which was ranging from Rs 10 million to Rs 15 million daily and the ultimate result will be difficulty in the achievement of the revenue target. To a question, he said that Pakistan Customs has no concern with the imposition of 1% infrastructure development cess and it is only related to the provincial government.
However, Acting General Secretary, FCAG, Mian Waheed Shah told that the officials of the Excise and Taxation Department are likely to Khyber Pakhtunkhwa Chamber of Commerce & Industry (KPCCI) on June 2, 2016 told hold negotiations with business community over the matter. He was very critical of the collection of IDC, which is imposed on Value Addition-Taxes by the provincial government. He said that the provincial government should have treated them at least at par with other provinces and despite overburdening the provincial government should have granted concessions to the business community of the terrorism affected province. He said that the strike has spread to all dry ports of Punjab and Khyber Pakhtunkhwa and clearing agents in Lahore, Faisalabad, Sambarial and Multan are also boycotting the clearing of goods.