Pakistan’s FMCG Association has demanded reduction in custom duties and taxes from Federal Board of Revenue (FBR) on all imported goods from 70% to 30%.
During the core committee meeting of the association, chaired by Anjum Nisar, Chairman FMCGA Pakistan, four main points were discussed. The main agenda of the meeting was focused on two major points, firstly discuss a crackdown on smuggling which is being done from Afghanistan border and bringing down the tax rates to 30% on imported goods.
High import duties open the back door options for people, allow them to go for illegal imports. This is creating a huge loss for potential and legal importers as well as national exchequer. Bringing down the import taxes will ensure legal importing in the country and promote fair competition among businesses while reducing the illegal imports. The association also urged concerned departments to stop the illegal imports of goods which have been increased lately.
Secondly, low taxes and duties on imports create problems at national level, imports flocking in, surges due to low duties which create an imbalance between imports and exports. Larger imports not only create trade deficit but also affect foreign exchange reserves.
Lower duties and taxes on FMCG goods and services also curb the local industry to flourish. The association is only thinking about their profits and benefits, they should think about the whole country in return.
Though the 70% rate is quite higher on imports, 30% would create a mess in the trading landscape of the country. FBR can accommodate importers by lowering the tax rate a little to 60% depending on the circumstances.
FMCG Association is looking to devise the unanimous policy and holding the convention in Lahore in September. All the importers and retailers would be invited to that convention to support the cause.