GST waiver on tractors urged

LAHORE: Farmer body has asked the government to waive general sales tax (GST) on locally-made tractors and implements, a statement said on Monday.

Khalid Mahmood Khokhar, president of the Pakistan Kissan lttehad (PKI) said that agriculture sector, being the backbone of Pakistan's economy, contributes approximately 24 percent to GDP.

However, presently it is facing a severe blow due to increase in the cost of production and decrease in output due to various factors. This worrying development has an adverse impact not only on farmers’ earnings, but also on their buying power, he added.

Resultantly, they are unable to bear the high cost of inputs. One of the consequences are decline in the purchase of tractors. According to latest figures, he said, tractor sale has declined 25 percent from 32,500 units (July to December 2017) to 24,500 units (July to December 2018).

Moreover, the tractor industry also strengthens the government exchequer by contributing over Rs10,000 million in direct / indirect taxes every year. To support farmers for the purchase of tractors and implements, it is requested that GST on locally-made tractors and implements be waived off, he stressed.