The Pakistan Flour Mills Association has threatened the government to remove 7 per cent sales tax on bran otherwise the mills will stop washing of wheat from July 10, Friday. And if implementation of this unjust tax on flour industry continues the industry will halt grinding of flour from July 11, Saturday.

Addressing a press conference, here at PFMA office, the leaders of flour mills said that mills profit margin is very low and price is fixed by the provincial government. They said that due to imposition of 7 per cent sales tax on bran, the cost of mills will be increased by Rs15 per 20kg bag of flour.

Regarding 0.6 per cent tax on banking transaction, the representatives of PFMA said that after the implementation of this tax the flour industry’s dealing with banks is almost stopped as the whole business is done by non-registered sector in the country.

They said that the representatives of traders and industry have opposed the government’s decision of taxing all the banking transactions as it may lead to promote the culture of cash dealing, usage of non-banking channels besides hitting hard the genuine businesses. The government should have promoted transactions through banking channels but such steps will force them to pay in cash or use other non-banking channels.

They said if the government thinks that it would increase its revenue by this way, it should broaden its tax net and bring those into it who are still not paying taxes instead of screwing those who are already contributing to the national exchequer.

They said that the rate of further tax for supplies to unregistered persons is being enhanced to 2%.A new form of Income Tax (Withholding Tax) across the board has been introduced by imposing 0.6% on all banking transactions and instruments issued by non-filers which is aimed at broadening the tax base. By the virtue of this tax, the FBR has put the burden of netting non-filers on registered persons, which is unlikely to bring the desired results. It will only add to the cost of doing business that would be passed on to the consumers.