Govt, flour millers reach agreement on income tax

LAHORE: Federal government and Flour Mills Association reached an agreement as the government assured the flour millers that Income Tax Act would not apply on the flour mills .

The flour mills will now continue operations across the country as usual. As per agreement, Section 153A of the Income Tax Act will not apply to the flour mills. From now onwards, the flour mills will instead sell flour under the commission system. As per the mechanism mutually agreed, flour dealers and retailers will charge commission per bag for selling flour. The commission amount will be subject to the Withholding Tax under the Income Tax Act. Those wholesalers and retailers whose annual sales are less than Rs100 million will be included in the Withholding Tax net from the coming year. Tax reforms for the flour business will be included in the finance bill of the next financial year.

A meeting in this connection was held under the chairmanship of Federal Minister Ahad Cheema while Federal Minister for Finance Muhammad Aurangzeb, Minister of State Ali Pervez Malik and the chairman FBR attended it. Flour Mills Association Central Chairman Asim Raza along with the chairman of provincial bodies represented the industry.