Cement Dealers Declare Strike in Protest of New Taxes

Following the lead of petroleum dealers and flour millers, the Cement Dealers Association of Pakistan has initiated an immediate strike in protest against recent tax increases imposed by the government.

The Finance Act 2024, which raised the withholding tax for non-filers under Section 236H from 1% to 2.5% and introduced a turnover tax on dealers and retailers, has ignited widespread dissatisfaction among cement dealers.

Chaudhry Muneer, the Patron-in-Chief of the Association, declared the strike during a session at the Lahore Chamber on Saturday, stating, “Starting today, no cement dealer will procure cement from the companies.” This bold action is anticipated to disrupt the supply chain significantly, impacting construction projects nationwide.

Sajid Chaudhry, another prominent figure within the association, voiced concerns about the heightened tax burden, asserting that it is diminishing business prospects for traders and industrialists.

He cautioned that the increased taxes might encourage tax evasion. He noted, “The cost of a cement bag has now risen to Rs1500 due to the stringent measures introduced in the budget,” underscoring the adverse effects on the entire cement distribution system.

The association highlighted the challenges faced by many dealers and retailers, particularly those who may lack education or the capacity to maintain comprehensive records or operate Points of Sale as required by the Federal Board of Revenue (FBR). Chaudhry emphasized that the heavy taxation and perceived harassment by FBR officials regarding the installation of Points of Sale are pushing dealers to contemplate shutting down their businesses.

“Cement dealers and retailers are integral to the distribution network of the cement industry, which is vital for the national economy,” emphasized Chaudhry.

The strike underscores the pressing need for the government to review its tax policies and address the grievances of dealers to ensure stability in the cement sector and broader economic implications.

Impact on the Construction Sector
The strike by cement dealers is expected to cause substantial delays in both public and private construction projects throughout Pakistan.

Concerns have been raised by contractors and builders regarding potential cost escalations and extended project timelines due to disruptions in cement supply.

Government Response
As of now, the government has not formally responded to the strike. However, analysts anticipate that sustained disruption in the cement supply chain could prompt government officials to initiate dialogue with the Cement Dealers Association to seek a mutually acceptable resolution.

For the latest developments on the cement dealers’ strike and its repercussions on the construction industry, continue to monitor our news portal.

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