Wheat tax threatens to spike flour prices in Pakistan: Details inside

ISLAMABAD: Pakistani consumers face another potential economic blow as the government is mulling new taxes on wheat products that could significantly increase the price of flour, here on Thursday.

As per the details, the Pakistan Flour Mills Association has called an emergency meeting in Lahore this week to deal with the crisis. Flour mill owners are urging the government to reconsider its decision to impose withholding tax on wheat products, warning of disruptions and industrial strikes if their plea is ignored.

Pakistan Flour Mills Association Chairman Chaudhry Amir Abdullah expressed serious concerns during an interview, he said that the proposed withholding tax may increase the prices of wheat, flour and fine flour by Rs 7 per kg.

He asserted that if implemented, this tax adjustment would drastically increase the price by Rs 106 on a 10 kg bag of flour and Rs 460 on sacks of fine flour.

Highlighting the stark disparity in tax compliance, Abdullah pointed out that only 2 percent of Pakistan’s population pays direct taxes, while the remaining 98 percent bear the brunt of indirect taxes, including sales tax. He stressed that the imposition of withholding tax on wheat products would inevitably increase the prices of essential commodities, which would adversely affect common households across the country.

Emphasizing the limitations of the flour mills association, Abdullah clarified that neither he nor the flour mills came under the purview of the government or its revenue-collecting agencies, such as the Federal Board of Revenue.