Key Takeaways:
- Traders’ delegation met with Lahore Chamber President to discuss concerns over new sales tax changes.
- New taxes on educational materials could significantly increase costs for students and parents.
- The business community calls for educational materials to be exempt from new taxes to avoid further financial strain.
Delegation Meets Lahore Chamber President
A delegation of traders, led by Khalid Pervez, visited the Lahore Chamber and met with its President, Kashif Anwar, to express concerns over changes in the sales tax system introduced in the latest Finance Act. The delegation included key members from the Lahore Stationery Association Urdu Bazaar, such as President Jameel Fazil, Secretary Information Mahboob Iqbal, Chairman Muhammad Raza, and Vice President Abdullah Khan.
The Finance Act 2024 has brought substantial changes to the sales tax system, affecting numerous stationery items that were previously exempt under the Sixth Schedule. Items like writing ink, drawing ink, erasers, exercise books, pencil sharpeners, geometry boxes, pens, markers, and pencils (including colored pencils) are now subject to a 10% sales tax.
Impact of New Tax Regulations
The delegates highlighted that the newly introduced changes in the Finance Act will significantly impact business costs, resulting in higher prices for various items. They strongly protested the imposition of taxes on educational materials, emphasizing that this would lead to a considerable increase in educational expenses, adding financial burdens on students and parents.
Business Community’s Stance
The business community warned that the current economic conditions are already strained, with sales rates plummeting. They cautioned that if these taxes are enforced, conducting business would become increasingly difficult, potentially leading many traders to shut down their operations.
Detailed Changes in Sales Tax System
The Finance Act 2024 has brought substantial changes to the sales tax system, affecting numerous stationery items that were previously exempt under the Sixth Schedule. Items like writing ink, drawing ink, erasers, exercise books, pencil sharpeners, geometry boxes, pens, markers, and pencils (including colored pencils) are now subject to a 10% sales tax. Additionally, extra taxes will be applied under sections 236G and 236H, with a tax deduction rate of 0.5% for filers and 2.5% for non-filers. Those whose tax deduction exceeds PKR 100,000 must register under the Sales Tax Act 1990. Filers can purchase up to PKR 20 million without sales tax registration, while non-filers have a limit of PKR 4 million.
Call for Government Action
LCCI President Kashif Anwar assured the delegation of the Chamber’s support for the business community. He emphasized the government’s duty to maintain essential services like health, education, and law and order while providing maximum facilities to the business sector for economic growth. Acknowledging the country’s economic challenges, he urged the government to reconsider the tax on educational materials and withdraw it immediately.
Appeal for Affordable Education
Kashif Anwar commended the Punjab government’s efforts to support students but called for measures to make education more affordable. He stressed that children need access to education to progress and warned that new taxes and laws would adversely affect already inflation-burdened segments of society.
Traders’ Demands for Relief
Highlighting the impact of inflation on electricity, gas, essential items, and business operations, Anwar reiterated the traders’ demand for a review of these taxes on educational materials. He advocated for the continuation of the previous system to provide relief to the business community during these challenging times, assuring that he would raise the traders’ concerns on all relevant platforms.
