LAHORE: The Pakistan Steel Melters Association (PSMA) has urged the government to abolish five percent regulatory duty on shredded steel scrap and also bring down the ratio of sales tax on electricity for the steel melting industry to Rs 4 from Rs 9 per unit.
PSMA Chairman Mian Muhammad Saeed along with executive committee members including Mian Azizur Rehman Chan made these demands in a press conference.
Mian Saeed also demanded the government abolish adjustable sales tax at the import stage, as it blocks the working capital of steel melters to run their daily trade and manufacturing affairs.
To a question, he elaborated that in 2007, Federal Board of Revenue (FBR) after taking board all stakeholders (steel melters, steel re-rollers, ship breakers and Pakistan Steel Mills) had given a formula named as Special Procedure 2007. Under the Special Procedure, he added, the sales tax ratio on per unit electricity for melting industry was Rs 4 75 but this ratio had been increased up to Rs 9 in the current budget 2015-16. He appealed to the authorities concerned to bring this sale tax ratio down to Rs 4 per unit of electricity.
The PSMA Chairman underscored the need for effective measures by the departments’ concerned to curb smuggling of steel billets, raw materials and finished steel goods through land routes especially from borders of Sust with China and Torkham with Afghanistan.
To another question, Mian Saeed said that steel melting industry also hit hard by the melting units operating in tribal areas such as FATA, PATA, Dargai and Mohmand Agency. He explained that the government exempted steel melting units in tribal areas from all sorts of taxes and duties and bound these to supply their finished products only within the tribal areas but these units supply their finished goods illegally to settled areas/cities of the country at a very cheap price thus creating huge problems of competitiveness for the regulated melting units.
