A number of influential business personalities have criticised the decision to impose 6.5 per cent withholding tax on the turnover for flour mills.
The Pakistan Businessmen and Intellectuals Forum (PBIF) president, AKIA president, senior vice chairman of the Businessmen Panel of FPCCI and former provincial minister Mian Zahid Hussain have all criticised the decision.
Those criticizing the measure say it will jack up prices of wheat flour by Rs 5 per kg creating unrest among masses who are already paying a heavy price for it.
Mian Zahid Hussain said that 915 registered and many unregistered mills are doing business of Rs 275 billion while authorities are eying collection of Rs 15 billion as taxes which is against the constitution and national interests.
Collecting tax from registered mills and avoiding unregistered grinding units will distort the market, he observed.
He said that the authorities tried this a few months ago but on May 12, Special Assistant to Prime Minister Haroon Akhtar Khan overturned the decision to impose 6.5 per cent withholding tax on the turnover of the flour mills terming it against the interests of the masses.
He directed the FBR officials to stop serving notices on flour millers and continue to collect tax as per the practice for the last four years as tax on turnover will jack up prices of the staple. Khan also asked the owners of grinders to improve their documentation to avoid taxation problems in future.
He said the authorities have once again started the move which is against the constitution as agriculture is not a federal but a provincial subject. This is also a plea taken by the federal government when it comes to imposing taxes on landed elite, he added.
Mian Zahid Hussain said that the government has not fully recovered from the crisis of evaluation of property and triggering another crisis at this juncture is not advisable as it can result in serious political crisis.
He also asked the flour millers to pay full price of wheat to the growers and stop exploiting them.