LCCI calls for early so­lu­tion of Steel Mel­ter's is­sues

The Pak Banker - - NATIONAL -

The La­hore Cham­ber of Com­merce & In­dus­try has urged the govern­ment to fo­cus on the re­ha­bil­i­ta­tion of Steel Melt­ing In­dus­try that is in deep trou­ble be­cause of Gen­eral Sales Tax on elec­tric­ity bills and var­i­ous other is­sues.

While talk­ing to a group of Steel Melters As­so­ci­a­tion, pres­i­dent of the La­hore Cham­ber of Com­merce & In­dus­try Sheikh Muham­mad Ar­shad, Se­nior Vice Pres­i­dent Al­mas Hy­der and Vice Pres­i­dent Nasir Saeed said that the Gen­eral Sales Tax on the elec­tric­ity bills of Steel Melters should be re­duced to four ru­pees from ex­ist­ing nine ru­pees which is very high and one of the big­gest rea­sons of high in­put cost of the Steel Melt­ing In­dus­try.

The del­e­ga­tion in­formed the LCCI of­fice-bear­ers that the steel melt­ing sec­tor has a pro­duc­tion ca­pac­ity of 7.5 mil­lion tonnes which has been re­duced to 3.5 mil­lion tonnes, mainly be­cause of im­port of fin­ished and semi-fin­ished steel prod­ucts. The lo­cal in­dus­try pro­duces iron bil­lets, girder, an­gle and other prod­ucts thus gen­er­at­ing a sub­stan­tial amount of rev­enue to the na­tional ex­cheq- uer. Yet, they agreed that the Fed­eral Board of Rev­enue in 2007 had taken all stake­hold­ers in­clud­ing steel melters, steel re-rollers, ship break­ers, and Pak­istan Steel Mills into con­fi­dence and evolved the Spe­cial Pro­ce­dure 2007 which it re­solved that the gen­eral sales tax at the rate of Rs 4.75 per unit would be levied on elec­tric­ity bills, which was later en­hanced to Rs 9 per unit in the fed­eral bud­get 2015-16. At that time, the raw ma­te­rial-shred­ded steel scrap was $350 to $360 per tonne that has been de­clined to $190 to $200 per tonne. Ac­cord­ing to the Pak­istan Steel Melters As­so­ci­a­tion, the steel melt­ing fur­naces utilise elec­tric­ity on very large scale as its raw ma­te­rial. Though it is the largest rev­enue gen­er­at­ing sec­tor in Pak­istan till to date but in deep trou­ble due to un­fa­vor­able poli­cies. They also urged the govern­ment to with­draw ad­justable sales tax at im­port stage as it blocks the work­ing cap­i­tal for a long time span. They also de­manded with­drawal of 15% reg­u­la­tory duty on steel scrap which is also one of the ba­sic raw ma­te­ri­als of the steel melt­ing in­dus­try. The LCCI of­fice-bear­ers said that con­cerned au­thor­i­ties should keep in view the ground re­al­i­ties and solve the is­sues of Steel Melt­ing In­dus­try at the ear­li­est.

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