Sunday May 29, 2022

Farmers decry sales tax on tractors

By Our Correspondent
May 15, 2022

LAHORE : Farmers have strongly criticised the move of the Federal Board of Revenue (FBR) whereby only those farmers can get the tractors at five per cent GST, who will provide copy of pass book or land holding record verified by the land revenue office concerned.

Through SRO 563 issued on April 29, 2022, now it has been decided to impose whopping 17 per cent GST on all other cases. This new SRO is not practical as it will create multiple problems for the farmers, claimed Khalid Mahmood Khokhar, President, Pakistan Kissan Ittehad here Saturday.

He was of the view that the extra cost and time-consuming process to get the copy of land records and verified it from the land revenue authority would be cumbersome for ordinary farmer. Moreover, in case of joint family system, mostly lands are not transferred to the youth, who are doing practical agriculture and buy tractor and farm machinery. So, they have to pay 17 percent sales tax as they are not actual land owner.

The SRO also does not cover the farmers doing farming on land through contract, rental or lease basis arrangements, he said, adding agro-rental-service providers having no lands or purchased farm machinery on bank loan against urban or any other non-agriculture property would be a bottleneck in this regard. Furthermore, he observed, in many areas of the country, the land records are not regularly updated. Farmers in this case will also pay the extra tax and price. Owing to such practicalities, situation is very upsetting for the farming community as they are already under severe economic pressure due to increase in agriculture inputs prices and water shortage, Khokhar maintained.

Therefore, Pakistan Kissan Ittehad, would like to request the prime minister, Minister for National Food Security, Minister for Industries and Finance Minister to immediately take notice of this issue and advise the FBR to immediately withdraw SRO 563. Moreover, 5pc sales tax rate be ensured on tractors being key requirement for agriculture and a source of self-employment for rural youth.