Traders threaten countrywide strike

WASIM IQBAL,

ABDUL RASHEED AZAD

& NUZHAT NAZIR

ISLAMABAD: The trade bodies, transporters, farmers, CNG pump operators, textile industrialists, owners of small & medium enterprises have all threatened countrywide strike against the tax measures contained in the budget 2019-20.

Representatives of traders from all over the county gathered here in Islamabad on Monday and condemned the govt’s anti-business measures which, they claim, were formulated without any input from the relevant stakeholders including Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and Karachi Chamber of Commerce and Industry (KCCI). Traders also expressed serious concerns over the amnesty scheme and action against non-filers, biometric verification of bank accounts.

The newly introduced Section 8 (M) of the Sales Tax Act requiring all sales tax invoices to include the buyer’s CNIC number was also rejected by the traders after distributors of various manufacturing companies began disseminating ‘Customer NIC Acknowledgement Form’ to shopkeepers – a form which requires detailed information including their business/shop name, name of proprietor, CNIC number of proprietor and a copy of the national ID card.

All City Tajir Itehad Association general secretary Ahmed Shamsi told Business Recorder that volatile exchange rate has severely disturbed the imported items pricing. If the government does not take appropriate measures to deal with our grievances, he warned, we will shutdown markets.

Islamabad traders’ action committee president Ajmal Baloch said “we have rejected the budget and today begun our protest drive”, adding traders have staged a token sit-in in front of Federal Board of Revenue (FBR) on Monday and in coming days, if demands are not met the traders will scale up their protest.

Farmers, including growers of potatoes, when contacted by the Business Recorder stated that they have been suffering serious financial losses over the years but in the past two years they have been unable to recover input costs. And over the past one year repeated increase in electricity, gas, high speed diesel and light diesel prices have put an additional financial burden on the farming community.

Pakistan Kissan Ittehad (PKI) has called an emergency meeting to devise their future strategy after the government failed to meet their demands with respect to abolishment of General Sales Tax (GST) on fertilizer, agriculture machinery and reducing electricity tariff for agriculture tube wells.

“The government has not only turned a deaf ear to our demands but also imposed Value Added Tax (VAT) on fertilizer and 10 percent GST on cotton ginners in the budget 2019-20 which will further increase cost of production,” PKI president Khalid Khokhar stated while talking to Business Recorder.

All Pakistan Sugar Dealers and Wholesales Association chief Muhammad Ayub Rana said the Federal Board of Revenue has imposed 2.5 percent withholding tax in the annual budget against their turnover of 0.1 percent which is unfair.

If the tax is not withdrawn, he argued, sugar dealers will shut down their shops and will not procure sugar from sugar mills. He further said that consumers may face up to Rs 20 per kg increase in the price of sugar after imposition of withholding tax.

Malik Mohammad Sultan said due to government policies the embroidery sector in Faisalabad, providing jobs to thousands of people, is on the brink of total closure and recent steps taken by the government including fiscal measures, will ensure closure of the embroidery sub-sector.

Cement dealers and distributors are not picking up cement sacks from factories; and cement dealers’ associations insist the government must withdraw its decision to allow wholesale dealers to purchase goods only upon revealing details of their identity cards.

The All Pakistan CNG Association (APCNGA) stated that notification for a 31 percent hike in gas tariff has been issued which will translate into an increase of Rs21 to Rs22 per kg in CNG rates for the consumers of Sindh, Khyber Pakhtunkhwa, and Balochistan provinces.

APCNGA senior leader Ghayas Paracha said new gas prices are unacceptable therefore the government should resolve this issue through consultation with APCNGA and other stakeholders.

According to the notification, the price of natural gas for CNG was raised from Rs 980 per mmbtu to Rs1283 per mmbtu, the highest single raise during the last decade, said Ghayas. This increase will have no impact on CNG consumers of Punjab as CNG stations of the province are using imported RLNG, he said.

He said the formula for sales tax has also been changed which will increase the cost of this economical fuel by between Rs2.25 to 2.74 in different provinces.

The government can avoid closure of CNG industry and resulting unemployment by accepting the APCNGA formula which will also help it save one billion dollars per annum, he added.

The traders of All Pakistan Textile Processing Mills Association (APTPMA) have also announced a shutter down strike in Faisalabad and other cities against the imposition of new taxes in the fiscal budget 2019-20.

APTPMA secretary Muhammad Ashraf said following the imposition of new sales taxes, buyers have stopped giving orders.

If the deadlock between the traders and the government persists then the situation may turn into a crisis, leading to severe shortages in the market, the productive sectors warned.

The non-registered would have to pay 20 percent tax and reveal their identity cards before purchasing goods, whereas thousands of local buyers are still unregistered and do not want to register themselves.

He said the government was requested multiple times to undo the requirement of identity cards for the dealers, but to no avail.