Traders threaten to stop imports through WHT

KARACHI:

Traders at Jodia Bazaar, the largest wholesale market for goods in Karachi, have warned that they will stop imports if the new withholding tax (WHT) is implemented.

During a press conference on Saturday, Rauf Ibrahim, President of the Wholesale Grocers Association, announced that the closure of Jodia Bazaar shops was a protest against the recent hikes in WHT and electricity tariffs. He criticized the 2.5% increase in WHT on pulses and commodities, questioning why traders who already pay an annual fixed tax should also be required to act as withholding agents.

Ibrahim, along with Ahmed Majeed, President of Pakistan Pulses Importers Association, argued that pulses and rice are staple items and the additional tax burden is unjustified. “We are making it clear to the government that if these taxes are imposed, we will stop importing pulses. The government will have to manage the import of pulses itself,” he warned.

He also lamented the rising business costs due to increased electricity tariffs, which he claimed benefit only a small elite while burdening the common man. Ibrahim pointed out that Pakistan imports 20 million tonnes of pulses annually. Though revenue is being collected, fresh surcharges of 45% and 10% on revenue have added to the financial woes of traders. He urged the FBR to reconsider its approach and called on the government to intervene.

Majeed echoed these concerns, noting that Pakistan is one of the world’s top three importers of commodities. He criticized the government’s decision to impose the WHT, arguing that it has complicated functions rather than providing relief. He warned of possible supply chain disruptions and said that if the tax is not withdrawn, traders will stop placing orders for pulses.

Currently, only a month’s supply of pulses remains in the wholesale market and with 70% of local traders already halting imports, the situation is becoming increasingly precarious.