ISLAMABAD: The National Assembly Standing Committee on Industries and Production Thursday recommended to review the tax regime applied on imported parts and local vendors related to automobile sector for the development of local industry.

The committee met here with Sajid Hussain Turi in the chair and discussed the matters related to local automobile sector and tractors manufacturing in the country, said a press release.

The meeting took place at factory premises of Millat Tractors Limited and were briefed about the company business situation, efforts to increase the localization and maintaining the world quality standard in tractors being manufactured locally.

The committee was appraised that since the local cost of production was very high, mainly due to exchange rate impact, rising raw material cost and inflationary impacts, however Millat Tractors Limited was increasing its export to Middle East and African countries as well.

Discussing the matter of higher prices, the committee was informed that region-wise comparison of Pakistan Millat Tractors was much better than India and China.

The direct and indirect taxes account for more than 30 to 40% of the total cost of tractor, therefore the industry had to increase the tractor prices to recover the cost impact.

It was informed that Millat Tractors was already manufacturing 95% parts of its major products and the prices were increased due to higher tax rate structure and exchange rate fluctuation.

The meeting was informed that if taxes were reduced, the tractor prices would be reduced accordingly.

The company urged government to reduce taxes, which would immediately led to reduce tractor prices and increase production and sales volume.

The committee directed the Federal Board of Revenue to help in quick processing and payment of refunds of Sales Tax and also recommended that State Bank of Pakistan should follow up with Zarai Taraqiati Bank Limited for farm machinery loans to farmers on concessional rates.

The members of the committee also visited the plant and appreciated the investment made to manufacture in-house tractor components and admired the role of Millat Tractors Limited.

The meeting was attended by the members of national assembly including Muhammad Akram, Sahibzada Sibgatullah, Sajida Begum, Usama Qadri, Aliya Hamza Malik, Riaz Ul Haq, Mahar Irshad Ahmed Khan, Abdul Rehman Khan Kanju, Shandana Gulzar Khan.

Senior officers from Ministry of Industries and Production, Engineering Developmetn Board also attended the meeting.