LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) has urged the government to take notice of the misuse of tax exemptions by the industries in Fata/Pata.
Talking to the heads and representatives of various trade and industrial associations, LCCI Acting President Mian Rehman Aziz Chan said that the misuse of tax exemptions in Fata/Pata is hampering the competitiveness of industries based in Punjab.
The Federal Board of Revenue (FBR) has granted sales and income tax exemptions to industries based in erstwhile Fata/Pata in 2018 on the imports of certain raw materials.
In a recent development, the exemption of federal excise duty has also been granted to the industries based in erstwhile Fata/Pata with effect from July 1, 2021.
Chan said that these raw materials are imported and sold in Punjab, which results in heavy tax evasion. This misuse is seriously hurting the regular industries based outside Fata/Pata, especially the foam industry and steel melters, etc.
The tax exemptions in Fata/Pata have resulted in 30 per cent reduction in the production of the industries in other parts of the country, he said, adding that the tax exemptions should be withdrawn immediately.
The amount of tax exemptions is around Rs30 billion. The government should withdraw the exemptions and spend this amount for the promotion of information technology and education sectors in Fata/Pata to produce skilled human resources.
