KARACHI - Karachi Chamber of Commerce and Industry (KCCI) President A. Abdullah Zaki has extended full support to Pakistan Yarn Merchants Association (PYMA) in resolving a controversial issue pertaining to 2 percent sales tax on commercial imports of raw material and 2 percent value addition sales tax as these illegitimate taxes have resulted in raising the cost of doing business and this important sector of the economy was on the verge of collapse. Talking to a delegation of Pakistan Yarn Merchants Association led by its Chairman, Khursheed Ahmed Shaikh during their visit to KCCI, A. Abdullah Zaki assured that the chamber will take up this issue with concerned authorities by sending a joint delegation of KCCI and PYMA to Islamabad in order to bring this issue to the notice of Chairman of Federal Board of Revenue (FBR) and concerned officers.
Abdullah Zaki demanded level playing field to all stakeholders, commercial importers as well as industrialists and requested that the value addition sales tax should not be more than 0.5 percent at import stage.
PYMA delegation informed KCCI that this issue has been raised from time to time with various concerned officials but to no avail, resulting in overburdening this industry and triggering anxiety amongst the businessmen associated with yarn trade.
Chairman PYMA, Khursheed Ahmed, while stressing the need for maintaining good coordination between KCCI and PYMA, reiterated that they must work together to urge the decision makers for reducing this illegitimate sales tax from existing 2 percent to 0.5 percent so that the businessmen could take a sigh of relief.
Referring to Section 8-A, Khursheed Ahmed explained that the importers usually pay sales tax at the port on arrival of consignment but it is highly unfair that the importers remains liable for six years even after dispatching the import consignment to suppliers who later on sells it to any other businessmen. It is highly unfair to hold the importer responsible for any subsequent fraud during the 6-year period, which was either done by the supplier or by any other businessman who usually flee after executing such fraudulent practices. This illegitimate rule under Section 8-A requires thorough explanation by the authority.
He further advised the government to take all stakeholders into confidence in resolving this pending issue otherwise it will get more complex in the years to come.