ISLAMABAD (PEN) : The Pakistan Flour Mills Association (PFMA) is in the second day of their strike against the newly imposed withholding tax, resulting in the closure of hundreds of mills nationwide. This has halted wheat grinding and flour supply, raising concerns about a potential shortage of staple food.
The federal government introduced a withholding tax of up to 5.5% on various stages of the supply chain in the current fiscal year’s budget, making flour more expensive, according to PFMA leaders. Flour mills in cities like Bahawalpur, Bahawalnagar, Jhelum, Kamalia, Sargodha, and Toba Tek Singh are currently shut down.
Shahzad Qureshi, Senior Vice Chairman of PFMA’s Peshawar Division, stated that the strike will persist until their demands are addressed. “The crushing has stopped due to the increased tax on flour and wheat,” he explained. He also called for the lifting of the ban on wheat and flour deliveries from Punjab and the abolition of check posts for wheat transport.
PFMA Chairman Asim Raza, speaking on Geo News, highlighted that while no direct tax has been imposed on flour mills, the government has made them withholding agents. He described the situation, saying that the mills must collect and deposit an advance tax based on sales to dealers, which creates a complex chain of withholding.
Raza emphasized that this decision will inevitably lead to higher flour prices, placing an additional burden on consumers. He noted that just a few months ago, a 20kg bag of flour was sold for Rs2,800, but the current price is Rs1,800. However, he warned that prices are likely to rise again due to these tax changes.
Despite the strike, Raza stressed that the millers do not wish to cause inconvenience to the public or confront the government. “We’ve always argued that the flour milling sector should be exempt from being a WHT agent, similar to how fertilizer dealers and manufacturers are treated,” he asserted, calling for fair treatment in the industry.
