LAHORE, May 13, 2025 — The Lahore Chamber of Commerce and Industry (LCCI) has strongly urged the Federal Board of Revenue (FBR) to withdraw two recently issued statutory regulatory orders (SROs) — SRO 578(I)/2025 and SRO 709(I)/2025 — which have sparked serious concern within the cement distribution sector.
In a formal letter addressed to Prime Minister Shehbaz Sharif, LCCI President Mian Abuzar Shad highlighted the far-reaching negative consequences of these SROs. The appeal followed an in-depth meeting between the LCCI and a delegation from the All Pakistan Cement Distributors Association, in which the operational and financial implications of the SROs were extensively discussed.
According to the LCCI spokesperson, senior figures including LCCI Senior Vice President Engineer Khalid Usman, former president Muhammad Ali Mian, and key association members such as Sheikh Abdul Majeed, Chaudhry Muhammad Muneer, and others were present during the consultation.
Mian Abuzar Shad criticized SRO 578(I)/2025, issued on April 8, 2025, which mandates that all business transactions be conducted via bank channels and include complete buyer information. He emphasized that this requirement is impractical given Pakistan’s economic realities. Around 40 percent of cement sales are made to walk-in customers, many of whom cannot issue reliable cheques due to the risk of cheque bounces and the lack of effective legal recourse. The remaining 60 percent involves cash transactions with rural wholesalers and retailers, where access to banking infrastructure remains inadequate.
He warned that the policy could disrupt the entire documented supply chain, pushing compliant businesses towards informality, risking financial penalties and closure due to input tax disallowance.
In addition, Mian Abuzar Shad addressed the challenges posed by SRO 709(I)/2025, which requires integration with the FBR’s digital system. He explained that this imposes an excessive compliance burden on cement distributors, even though cement, as a third schedule item, is already taxed at the maximum retail price (MRP) during manufacturing. The LCCI president asserted that distributors have limited downstream documentation authority and derive no tangible benefits from integration.
Calling the policies disconnected from ground realities, the LCCI stressed that uniform compliance rules are unfit for essential commodity sectors like cement. Such measures could trigger artificial shortages, paralyze construction activities, and negatively impact GDP growth.
The LCCI urged the Prime Minister to suspend both SROs immediately and suggested that cement manufacturers should only transact with tax-registered buyers to maintain documentation without market disruption. The LCCI also recommended targeted consultations between the Prime Minister’s Office, FBR, and industry stakeholders to create workable, sector-specific regulatory frameworks.