Farmers denounce sales tax on tractors

LAHORE: Farmers strongly criticized the Federal Board of Revenue (FBR) decision that only such farmers can get the tractors at 5% GST, which will provide a copy of the booklet or land register verified by the relevant land revenue office .

Through SRO 563 issued on April 29, 2022, it has now been decided to impose a whopping 17% GST on all other cases. This new ORS is impractical as it will create multiple problems for farmers, Khalid Mahmood Khokhar, President of Pakistan Kissan Ittehad, said here on Saturday.

He was of the opinion that the expensive and time-consuming process of obtaining the copy of the land records and verifying it with the land tax authority would be cumbersome for an ordinary farmer. Moreover, in case of mixed family system, most of the land is not transferred to young people, who engage in hands-on farming and buy tractors and agricultural machinery. So, they have to pay 17% sales tax because they don’t actually own the land.

The SRO also does not cover farmers who farm on land through contractual, rental or lease arrangements, he said, adding agricultural rental service providers who do not have of land or purchased agricultural machinery through a bank loan against urban property or any other non-agricultural property. would be a bottleneck in this regard. Furthermore, he observed, in many parts of the country, land records are not regularly updated. In this case, the farmers will also pay the additional tax and price. Due to these practicalities, the situation is very upsetting for the farming community as they are already under severe economic pressure due to rising prices of agricultural inputs and water scarcity, Khokhar said.

Therefore, Pakistan Kissan Ittehad wishes to request the Prime Minister, Minister of National Food Security, Minister of Industries and Minister of Finance to immediately take cognizance of this issue and advise FBR to withdraw SRO 563 immediately. 5pc sales tax rate will be ensured on tractors being a key requirement for farming and a source of self employment for rural youth.

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