Retailers oppose early market closure

Demand simplification of sales tax, income tax regulations

LAHORE:

Chain stores in Pakistan have opposed the government’s decision of early closure of markets by 8pm from July 1, 2023 and have proposed simplification of sales tax and income tax regimes for retailers of all sizes.

They believe that the decision will badly affect business activities and thwart all efforts to improve economic situation in the country.

Talking to media on Friday, Chainstore Association of Pakistan Chairman Tariq Mehboob Rana stated that the National Economic Council’s recent approval to restrict retail activities till 8pm could be “last nail in the coffin of many organised retailers” because they were complying with all government regulations.

He pointed out that major shopping malls and prominent markets would be forced to close quite early and that would inevitably reduce the number of retail store employees by half.

At the same time, “smaller markets and neighbourhood stores will find ways to stay open, as was experienced during lockdowns during the Covid-19 pandemic”.

“We have proposed a balanced solution for retail; it can close at 10pm instead of unlimited timings, which has already been enforced in Lahore since December 2022,” Rana emphasised.

He was of the view that the government’s decision was based on unfounded claims of annual savings of billions of rupees. Rather, “this measure will cause a significant plunge in revenue of up to 30% for retail businesses”.

Regarding the federal budget for FY24, the association chairman underlined the need for simplifying the sales tax and income tax regimes for retailers of all sizes.

He also called for removing the discriminatory categories of “tier-I retailers” and “other-than-tier-I retailers”, which had badly impacted viability of the organised retail sector.

Published in The Express Tribune, June 24^th, 2023.

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