Sugar millers call for reducing Punjab cess

Suggest cess should be equal to levy collected in other provinces

LAHORE:

Sugar millers have urged the government to reduce the Sugarcane Development Cess in Punjab and make it equal to the levy imposed in other provinces.

"In Sindh and Khyber-Pakhtunkhwa, the cess on sugarcane is currently much lower than Punjab. The sugar industry requests the government to reduce the cess in Punjab from Rs5 and bring it on a par with other provinces," the Pakistan Sugar Mills Association (PSMA) said in a statement released on Friday.

It pointed out that the cess had been in force in Punjab since 1964 and it was levied on sugarcane in every crushing season. "However, its ratio is factored in the cost of production of sugar."

A PSMA spokesman said the tax on sugarcane supplied to mills was collected by the government equally from sugar mills and farmers. This tax is used for the construction and repair of roads from sugarcane fields to mills, construction of bridges, research and promotion of the sugarcane crop.

However, according to the spokesman, the sugar mills keep on receiving complaints from cane growers in Punjab that the cess is not only higher than other provinces but also district governments collect the levy, which is not utilised for the purposes specified in the law and the condition of roads from farms to mills remains dilapidated.

Pakistan has one of the highest tax rates on sugar in the world. Sales tax alone is 18%, while India has 5% tax, Thailand has 7% and China has 13%.