Flour mills observe countrywide strike tomorrow

ISLAMABAD: All Pakistan Flour Mills Association (APFMA) has announced countrywide strike on Wednesday (tomorrow) against exclusion of wheat flour from Schedule 6 of Sales Tax and imposition of tax on wheat brain.

While talking to The News on Monday, Chairman APFMA (Punjab chapter) Habib Ur Rehman Leghari said that they decided to go on strike on Wednesday in all over the country because they wrote letters to the FBR and other government functionaries but got no response from them.

He said the FBR excluded wheat flour from schedule 6 of Sales Tax and made part of Schedule 8 of Sales Tax after which 17 percent GST on wheat flour of 40 kg and above was imposed.

He said the flour bag of 10 and 20 kg were exempted from the sales tax but flour bags of 50 or 80 kg there would be GST charged on it.

Secondly the government imposed GST on wheat brain as it would make our businesses unviable. “We have decided to go on strike against all these steps taken by the government in the budget for 2019-20,” he added.

However, the FBR stated in its statement on Monday that in the wake of changes introduced in the Sales Tax Act, 1990, through the Finance Act, 2019, it is being generally reported that the sales tax has been imposed on wheat flour. For general information and in order to do away with the confusion on the issue, the FBR clarified that no sales tax has been imposed on wheat flour in any form i.e. aata, maida or suji.

It is further elaborated that serial number 19 of the Table-1 of Sixth Schedule to the Sales Tax Act, 1990, has been amended through the Finance Act, 2019, to withdraw exemption on those products of milling industry, other than wheat and meslin flours, which are sold in retail packing bearing brand name or a trademark.

This amendment does not affect the exemption already available to wheat flour and it remains exempted from sales tax under this serial, even if it is packed or sold under a brand name.

Further, through the Finance Act, 2019, a new serial number 59 was added to the Table-1 of Eighth Schedule to the Act, whereby the sales tax at reduced rate of 10% has been imposed on the products of milling industry except wheat and meslin flour if sold in retail packing under a brand name or trademark. This serial number also excludes wheat flour and therefore it if not applicable to wheat flour, the FBR concluded.