ISLAMABAD: The federal government has deferred imposition of sales tax on services on oil tankers till June 30.
“Our negotiations with the federal and provincial governments were successful therefore we are announcing an end to the strike,” said President (South) Oil Tanker Contractors Association (OTCA) Babar Ismail while talking to the media after negotiations with the government.
A meeting, which was presided over by the petroleum and natural resources secretary, was attended by representatives of three provinces-Punjab, Sindh and Khyber Pakhtunkhwa. The Balochistan government had participated in the meeting via phone, Babar Ismail said.
Since imposition of sales tax on services, it was the fifth strike called off by the OTCA. The provincial and federal governments had failed to come up with a solution to the issue since then. “The government has accepted our demands, deferred the imposition of tax till June 30 and constituted a committee to resolve the issue of double taxation,” Babar Ismail said.
It is pertinent to mention here that the provinces have levied sales tax on services of inter-city transportation or carriage of goods by road but they have failed to work out a distribution and collection formula. Punjab is demanding the tax to be recovered on the basis of destination of the transport carriage while Sindh seeks to fix the point of origination as base of tax collection. Every province wants to levy its own percentage of sales tax which will make it too expensive, Baber Ismail said. One province wants to charge 14 percent, other 15 percent and another 16 percent,” he said. “There is a dispute in the mode of collection and distribution formula among the provinces,” he said.
