LAHORE: The delay in implementing budgetary measures to reform the tax regime for steel producers sourcing local scrap from unregistered suppliers has led to a loss of over Rs30 billion to the national exchequer since July, according to industry insiders.
Organized, tax-compliant steel manufacturers report that the government is losing approximately Rs8 billion per month due to the Federal Board of Revenue’s (FBR) hesitation to apply an 18% sales tax on steel furnaces using local scrap.
“This is occurring at a time when the FBR is struggling to meet its tax targets and is working to enhance enforcement and compliance,” said Javaid Mughal, a prominent figure in the steel industry. Despite multiple meetings between steel millers and top FBR officials, the necessary SRO has yet to be issued.