KARACHI: The ship-breaking industry has urged the government to withdraw controversial notifications issued recently by the Federal Board of Revenue (FBR) and provide a level-playing field against the steel re-melting industry.
The Pakistan Ship-Breakers Association (PSBA) staged a protest outside the Karachi Press Club (KPC), where it warned the FBR that if their demands stayed unmet, they will be left with no choice but to close down the industry.
Later, while speaking to journalists at a press conference, the PSBA alleged that their industry was being discriminated against by the FBR.
“An attempt is being made to cripple the ship-breaking industry, which provides direct employment to over25,000 workers in the underdeveloped region of Balochistan at Gadani,” PSBA alleged.
PSBA said that the FBR gave undue advantage in the rates of income tax and sales tax to the steel re-melting industry through recently issued statutory regulatory order (SRO) 140(1)/2013 and SRO 243(1)/2013 dated March 26, 2013.
Elaborating on the SROs, PSBA Chairman Dewan Rizwan Farooqui said, “Previously, the ship-breaking industry had been paying 1% income tax, but now we have been asked to pay 5%, which means an increase of 500% in income tax.”
The other notification, SRO 243, removed ship-breaking industry from the ambit of special procedures.
Farooqui said that since both industries were in direct competition, the FBR’s notification had given one an advantage over the other. “This could become the cause of closure of the ship-breaking business,” he said.
The PSBA warned that if FBR does not withdraw the notifications, the ship-breaking industry will be forced to close down operations and this will directly hit the construction industry as prices of steel will shoot up from Rs65,000 per ton presently to Rs80,000 per ton.
Published in The Express Tribune, April 3rd, 2013.
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