KARACHI: Representatives of Pakistan Chemists and Druggists Association (PCDA) held a meeting with Dr Waqar Masood Khan, Special Assistant to the Prime Minister on Finance and Revenue and Dr Najeebullah, Chief Tax Policy Federal Board of Revenue (FBR) to discuss the insertion of pharmaceutical sector in Section 236-G & 236-H of income tax law.

The meeting was held virtually and attended by Chairman PCDA Salahuddin Sheikh, Senior Vice Chairman Saif Ur Rehman, Chairman South Zone Ghulam Hashim Noorani, Chairman Regulatory Affairs PCDA Abdul Samad Budhani, Member Income Tax Committee PCDA Ashraf Zaib and Ubaid Ullah leading distributor from KPK.

During the meeting, PCDA pointed out some anomalies in the federal budget FY22 and drawn the attention of government officials towards the insertion of pharmaceutical in Section 236-G & 236-H of income tax law, under which manufacturers and distributors will be required to collect advance tax from retailers and wholesalers on behalf of the Federal Board of Revenue (FBR).

Chairman PCDA said that implementation on the Section 236-H, will be very difficult for the distributor who are covering more than 6000 retail outlets. It is impossible for the distributors to collect data of NTN and CNIC from all outlets to deduct their advance income tax.

He said that the business module of the pharmaceutical sector is quite different from other businesses and it will be very difficult for the distributors to fully implement this law. “It will be a hectic exercise to check the status of thousands of retailers as they are filer or non-filer at the time of invoicing for collection of 0.5 percent and 1 percent advance tax to justify their sales,” said Salahuddin Sheikh.

During the meeting Dr. Waqar Masood said that after the approval of the Finance Bill from the parliament, now this proposal has become law and needs to be fully implemented. However, he said that the FBR will review all legal aspects of this law to facilitate the pharma sector. He further said that the government is fully facilitating the business community.

During the meeting Ubaid Ullah mentioned that distributors don’t have CNIC and NTN data of retailers, while as per law distributors are bound to ensure the drug supplies to the retailers having a drug license.

The PCDA representatives thanked Dr Waqar Masood and Dr Njeebullah for the meeting and it was decided that another round of dialogue will be held next week.

Copyright Business Recorder, 2021