Business community rejects regularity duty on imported items

PESHAWAR: The business community of Khyber Pakhtunkhwa on Wednesday rejected the imposition of regularity duty on essential and non-essential items and asked the government to review the decision.

The federal government had imposed and enhanced the regularity duty on essential and non-essential imported items from five to 80 percent in order to reduce the widening gap between imports and exports.

Sarhad Chamber of Commerce and Industry (SCCI) President Zahidullah Shinwari said the imposition of duty would affect the businessmen and business activities in the country in general and in Khyber Pakhtunkhwa in particular.

He said that other countries would react to the development and take counter measures by increasing duty and other taxes on items exported from Pakistan.

The SCCI chief maintained that the imposition of the duty would adversely affect the Pak-Afghan trade, which was already on the decline.

He said that 50 percent duty had been imposed on dry and fresh fruits imported from Afghanistan.”Afghanistan would take retaliatory measures and impose taxes on items imported from Pakistan which would affect the business community of Khyber Pakhtunkhwa,” he added.

The chamber head was of the opinion that the move might not help achieve the desired results and instead result in increase in smuggling which would deprive the country of existing revenue it was generating from Pak-Afghan trade.

Zahidullah Shinwari said the government instead of enhancing and imposing the regulatory duty should boost industrialisation to enhance production. “The production in the country is very low and we are importing items even from a needle to heavy machinery from abroad. This is the main cause of the imbalance in the import and export. The government should take drastic measures to revive the industrial sector to decrease reliance on imports to reduce the import bill,” he suggested.

The businessmen community leader said the government did not consult them and other stakeholders before announcing the decision which had raised concerns among them. He said the government should also define the essential and non-essential items.

President Frontier Customs Agents Group Ziaul Haq Sarhadi said the new taxes would affect the business community of Khyber Pakhtunkhwa and tribal areas.

Ziaul Haq Sarhadi, who is also Senior-Vice President of Pak-Afghan Joint Chamber of Commerce and Industry, said that Pakistan imported fruits, vegetables, carpet and other items of daily use from Afghanistan.

He feared the imposition of new levy would result in increase of prices of these items. “The trade between Pakistan and Afghanistan is already on the decrease and had dropped from $2.5 billion dollars annually to less than $1 billion dollars. The new taxes would bring this trade next to nil,” he added.

Ziaul Haq Sarhadi said that 70 percent of the businessmen had already shifted businesses to other countries for lack of facilities, security, high gas and electricity prices and a host of other issues, adding such irrational decisions would make the business tougher for those who were still in the country.

The businessmen community representative said the prices of items of daily use would shoot up and the move would render thousands of people jobless. He said that several Afghan traders had contacted him and conveyed concerns over the imposition of the regulatory duty on imports.

Ziaul Haq Sarhadi asked the federal government to reverse the decision and take the business community and other stakeholders into confidence over the issue.