Quoted by The Tribune Express
Karachi, Pakistan – The Pakistan Flour Mills Association (PFMA) has temporarily called off its strike after senior government officials, on behalf of Prime Minister Shehbaz Sharif, promised to resolve their concerns within 10 days.
PFMA Senior Vice Chairman Central Chaudhary Amir Abdullah told The Express Tribune that the flour millers had postponed the strike in the hope that the government will handle their taxation issues peacefully within the agreed-upon timeframe. He stated that if their demands are not addressed by July 22, the strike will restart.
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“All flour mills should resume wheat grinding operations to restore the supply of the staple food nationwide,” Abdullah stated.
The PFMA stated that, following the prime minister’s intervention, a committee has been formed to address their concerns over withholding taxes. The group seeks to standardize withholding taxes through mutual understanding. The members of the committee are:
- Minister for Law Azam Nazeer Tarar
- Minister for Economic Affairs Ahad Khan Cheema
- Federal Board of Revenue Chairman Malik Amjed Zubair Tiwana
- PFMA Chairman Central Asim Raza Ahmed
The association went on strike on Thursday, requesting that the government repeal newly imposed withholding taxes (WHT) and revoke the need that flour mills act as FBR agents to collect WHT from its clients, including wholesalers and retailers.
The government enforced higher WHT rates on non-filers who purchased flour, which disproportionately affects the poor. The new tax rates, effective from July 1, 2024, include:
5.5% WHT on flour mills
2.5% WHT on flour retailers (non-tax)
2% WHT on wholesalers (non-filers)
0.5% WHT on retailers (tax filers)
0.10% WHT on wholesalers (tax filers)
The PFMA highlighted concerns about becoming tax agents, citing potential legal and law enforcement complications, particularly for millers who sell directly to individual retail purchasers. They questioned why the government is causing problems for flour mills and proposed that the FBR conduct tax collection independently.
“We don’t have the capacity to collect taxes. We are flour mills, not tax-collecting agents. The tax collection activities would add to our cost of production,” an association official said.
