FPCCI demands normal tax regime for chemical merchants

KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has demanded the authorities to bring chemical merchants into normal tax regime (NTR) from existing minimum tax regime (MTR), a statement said.
FPCCI President Irfan Iqbal Sheikh, while speaking with large-scale merchants from the platform of Pakistan Chemical and Dyes Merchants Association (PCDMA), expressed concerns over the lack of facilitation and fair environment to the distributors and merchants of industrial raw materials who play an indispensable role in the export growth and import substitution.
Sheikh maintained that the chemical merchants must be brought into NTR instead of their current status of being in the MTR for the past two years; when they were removed from the Final Tax Regime (FTR).
He also proposed that in order to fight the menace of flying invoices in the sector, the condition of customer CNIC copy should be exempted and the turnover tax should be brought down to 1 per cent immediately from 1.25 per cent, while it should be brought down to 0.5 per cent gradually.
The FPCCI chief explained that the traders and middlemen in the industrial raw material supply chain must be facilitated as those are the ones that help keep the wheel of industrial production running; support export-oriented industries to meet consignment deadlines; assist to establish new industries and contribute to preserving precious foreign exchange reserves through import substitution.

He emphasised that the state institutions have been neglecting the merchants when they should be much more facilitated than the importers of luxury goods like cars, mobile phones, branded clothing and high-end food products.
PCDMA Chairman Kamran Riaz Bharara said that the imposition of 4.5 per cent Withholding Tax on the sales by the middlemen in the supply chain of the industrial raw materials, who buy from the commercial importers, is counterproductive as it raises the cost of doing business and squeezes the profit margins even further.
This is also a substantive impediment in the government’s policy to establish a robust, efficient and reliable supply chain for the industries, he added.