Association of Pakistan Motorcycle Assemblers (APMA) has demanded the government of reducing General Sales Tax (GST) to 15% from existing 18% in the forthcoming budget 2023-24
Chairman of APMA Muhammad Sabir Shaikh said that this measure would provide much-needed relief to motorcycle users who are grappling with the high cost of the US Dollar in the current economic climate.
Furthermore, Shaikh suggested that the government should consider registering all new motorcycle dealers for sales tax purposes. This would ensure the proper collection of taxes and prevent tax evasion within the industry.
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As motorcycles are included in the Third Schedule items for sales tax collections, registered dealers should be exempted from submitting monthly sales tax returns. Instead, Shaikh proposed that quarterly or half-yearly submission of returns would suffice, thus reducing the administrative burden on businesses.
Another critical concern raised by the industry relates to the alleged misuse of withholding tax policies by officials from the Federal Board of Revenue (FBR). It has been claimed that FBR officials have exploited the withholding tax issue for dealers with turnovers exceeding 100 million rupees, accepting bribes from motorcycle dealers.
To address this issue, industry representatives argue that only manufacturers, importers, and wholesalers should be registered as withholding agents, preventing any potential abuse of the system by traders.
The motorcycle industry plays a vital role in Pakistan’s economy, providing affordable transportation options to millions of people and generating significant employment opportunities. Therefore, it is crucial for the government to take prompt action to safeguard the industry’s sustainability and address the concerns raised by industry stakeholders.
The APMA’s proposals, including the reduction of GST on motorcycles, registration of all new motorcycle dealers for sales tax purposes, and reforms in the withholding tax policy, aim to create a conducive environment for the industry’s growth. By implementing these measures, the government can support the motorcycle industry, boost economic activity, and alleviate the financial burden on motorcycle users amidst the challenging economic circumstances.
