PPMA demands withdrawal of sales tax

Islamabad : Pakistan Pharmaceutical Manufacturers Association (PPMA) on Thursday gave the government a five-day ultimatum to withdraw a 17 per cent sales tax on import of raw material for production of the medicines.

The association’s chairman Qazi Muhammad Mansoor Dilawar said that they would be left with no option but to come on the streets against the government if it failed to withdraw the tax.

Addressing a press conference here in Islamabad, he said that they had held three meetings with Finance Minister Senator Shaukat Tarin on the issue but no headway was made.

He said the government had backed out of its own promise of refunding the tax amount to the industry at the export and purchase stage, but it had now promulgated a rule to refund the tax amount only after the consumption.

Dilawar said that this would crush the industry, and urged the government to either fully withdraw the tax or refund it on the purchase stage. He said the industry would be forced to go on strike if the government failed to withdraw it in next five days.

The chairman said that this would result in essential drugs shortage and price hike in the local market, adding that public would suffer due to the unjustified tax and the government’s failure to address it. The association’s vice-chairman Arshad Mahmood said the industry was fulfilling between 80 per cent to 90 per cent of the local medicines demand besides providing jobs opportunities to around one million people.

He said that all their workforce would be on the streets if the government failed to heed to their demand in the next five days.

Mahmood also accused the government of trying to increase medicines prices in the local market by imposing the 17 per cent sales tax. He clarified the industry could not increase the medicines prices by their own as only the federal government was authorised to review the medicines prices on recommendation of the Drug Regulatory Authority of Pakistan.

He said that pharma industry’s Rs2 billion refundable tax amount were stuck in the national kitty as the government was not willing to pay them back.

He said that Pakistani pharma industry was providing medicines to public at comparatively cheaper rates and the government was not in a position to import all the drugs in the given economic conditions.

He urged the government to review its decision on the sales tax and withdraw it as quickly as possible to ensure smooth supply of medicines in the market.