Government Surrenders to Petrol Pump Dealers’ Strike, Abolishes Advance Tax
Through the Finance Act, 2024-25, the Government has levied advance tax on sales to dealers, distributors, wholesalers and retailers as follows:
Sections
| Description
| Rate | |
| Filer | Non-filer | ||
| 236G | Advance tax on sales to distributors, dealers and wholesalers | 0.1% | 2% |
236H | Advance tax on sales to retailers | 0.5% | 2.5% |
Despite the levy of immaterial advance tax for filers, i.e., 0.1% / 0.5%, the Petrol Pump Dealers Association warned the government of going on strike on July 5, 2024. The government, bowing to pressure, immediately engaged with the association and assured them of a resolution.
On the same day, the Federal Board of Revenue issued a notification [attached] stating that petroleum dealers/retail outlets were facing undue hardship due to the levy of this advance tax. Therefore, it was clarified that this advance tax is not applicable to dealers/retail outlets of Oil Marketing Companies.
In contrast, other heavily burdened segments like the salaried class and exporters have been raising their concerns for a long time, but the government has been turning a deaf ear to them. It appears that the only way to resolve issues in Pakistan is to pressure the government and go on strike, without which nothing seems to be sorted out.
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