KARACHI: The cement manufacturers have asked the Federal Board of Revenue (FBR) to decrease federal excise duty (FED) stepwise to zero on cement.
In the budget proposal sent to FBR Chairman Muhammad Ali Tabba, the All Pakistan Cement Manufacturers Association (APCMA) chairman stated that the cement industry is subject to FED at the rate of 5% of retail price and general sales tax (GST) at the rate of 17% of maximum retail price. These taxes come to around Rs 100 per bag.
“This incidence of high taxation encourages evasion and negatively impacts consumption. The abolishment of excise duty not only eliminates tax evasion but also enhances cement consumption at reduced price,” he added.
He said that certain services are being taxed under independent provincial sales tax laws, which are in vogue in Sindh, Khyber Pakhtunkhwa and Punjab. Such services are still taxable under both the Federal Excise Act 2005 as well as under provincial sales tax laws, which are tantamount to double taxation.
“It is recommended that FED on all services rendered in Sindh, KP or Punjab may be abolished as it would eliminate double taxation and reduce cost of doing business,” he added.
Similarly, he said, before preferring appeal to the Office of Commissioner (Appeals) or Appellate Tribunal, a taxpayer is required to deposit the impugned duty demanded or penalty imposed in an appealable order. This mandatory compulsion is considered as a hindrance in the dispensation of justice.
The APCMA chief said the identical provisions in income tax and sales tax have already been repealed, therefore it is suggested that the same should also be removed from the excise law.
