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Express Tribune
4 days ago
- Business
- Express Tribune
Sahulat Bazaars to offer year-round relief
The Punjab government has begun preparations for establishing 100 Sahulat Bazaars across the province, aiming to curb inflation and ensure consistent access to essential goods at notified prices. Announced as a Special Chief Minister's Initiative under the Fiscal Year 202526 Budget, the project carries an allocation of Rs10 billion. Unlike previous short-term Ramazan markets, the Sahulat Bazaars will be permanent, purpose-built marketplaces established in every tehsil. These facilities will provide essential food and household items at government-notified prices in regulated environments designed to ensure the dignity and convenience for all consumers. Construction is under way at 13 sites, including Jaranwala, Pattoki, Sharaqpur, Muzaffargarh, Okara, Khanewal, Narowal, Jhelum, Mandi Bahauddin, Chunian, Wazirabad, Bhalwal, Noshehra Virkan, Jalalpur and Burewala. The government has already disbursed Rs3.4 billion for the initial projects, which are expected to become operational by August. The initiative also includes mobile markets, currently active at 15 locations across Lahore, aimed at improving access in densely populated areas while curbing encroachment and price gouging. Additional measures include free home delivery services, Sahulat Stalls offering prices below official rates, solar-powered bazaars, and upgrades to 36 existing facilities. Punjab Sahulat Bazaars Authority (PSBA) chief Naveed Rafaqat Ahmad affirmed that the government is treating the project with "unmatched urgency". The target is to have all 100 bazaars operational before Ramazan next year. To accelerate the rollout, Secretary of Planning, Coordination and Monitoring Dr Ehsan Bhutta convened a meeting to enforce tight deadlines for concept paper submissions and early funding releases. Divisional commissioners across Punjab have been instructed to fast-track land identification and resolve implementation hurdles. The PSBA, an autonomous authority, is overseeing the execution of the initiative. Officials say the programme represents a shift toward institutionalised price relief. Meanwhile, the Punjab Food Authority (PFA) launched legal action against a poultry supplier after intercepting a vehicle carrying dead chickens intended for sale in Lahore, seizing over 1,800 kilogrammes of diseased and unfit meat, officials said on Wednesday. The operation by a PFA enforcement team took place in the Chak Dhera area on the outskirts of the city. A loader rickshaw transporting dead poultry was stopped and an FIR was registered against the supplier. As part of a crackdown on unsafe practices, a safety task force also inspected more than 217,000kg of meat from 53 suppliers and warehouses in Tollinton Market. Meat prepared from birds suffering from various diseases was found and discarded on the spot. "Preparing meat from dead or sick birds is a serious crime," said the PFA director general, adding that investigations are under way to identify those involved in the supply chain of tainted poultry. He said the PFA is committed to aligning the meat processing and transportation with international standards. He said the authority is employing all available resources to dismantle what he termed an adulteration mafia operating in Punjab. He urged the people to purchase poultry that is slaughtered in their presence to ensure health safety and to report violations on the PFA helpline.
Express Tribune
29-05-2025
- Business
- Express Tribune
Govt mulls 1.5% tax on imports
At high tax rates, profit margins for sellers decrease, leaving them with options to pass on the burden to consumers, compromise on the quality of products, evade taxes or find cheaper illicit goods. photo: file Listen to article In what could become the single largest new revenue source in the budget, the government is considering imposing a 1.5% withholding tax on the value of imports. The tax would be collected by banks at the time of making payments to overseas suppliers. The measure, still under discussion, will be used as an enforcement tool to curb the widespread under-declaration of import values, a senior government functionary told The Express Tribune. He said that the tax would apply to commercial importers only, who would have the right to claim adjustments against their final tax liabilities. Currently, commercial importers pay withholding tax when filing goods declarations with the Customs Department. Under the new plan, however, the tax would be deducted when the payment is made to the foreign supplier through banking channels. Sources said the Federal Board of Revenue (FBR) has briefed the International Monetary Fund (IMF) about its proposal to tax imports at three key points: upon arrival, during shipment, and at the stage of payment to exporters. While it remains unclear whether the IMF has endorsed the proposal, the plan appears to be the government's biggest attempt in the budget at hitting the next fiscal year's tax target of over Rs14 trillion. Finance Secretary Imdad Ullah Bosal on Thursday said there were no plans to delay the budget presentation, reiterating thrice that it would be presented on June 10. Meanwhile, the Annual Plan Coordination Committee will meet on June 3, and the National Economic Council will convene on June 6 to approve macroeconomic and development plans for FY25. The proposed withholding tax would be deducted at the point of sending money abroad through letters of credit, said the sources. Banks would follow a model similar to how they deduct tax on overseas credit card payments. FBR spokesperson Dr Najeeb Memon and Chairman Rashid Langrial did not respond to queries on the matter for the purposes of this story. A recent report by the Policy Research Institute of Market Economy (PRIME), titled 'Combating Illicit Trade in Pakistan', estimates that the country is losing a staggering Rs3.4 trillion annually to black market activities. Of this, nearly 30% stems from misuse of the Afghan Transit Trade facility. These losses amount to 26% of the current fiscal year's total tax target. The report warns that illicit trade is eroding formal businesses, government revenues, and consumer safety. It highlights outdated border controls, minimal customs automation, a lack of risk-based profiling, and poor scanning technologies as key contributors to rampant smuggling. If passed by Parliament, the new withholding tax could offer the FBR a relatively easy way to collect revenue, especially since it would be implemented through banks. The tax authority has historically underperformed in areas where it must rely on its own enforcement rather than external withholding agents such as banks, provincial bodies, or employers. The government has previously relied on indirect taxation, including last year's controversial 20% federal excise duty (FED) on the packaged juice industry. The result was a 45% drop in sales, according to Atikah Mir, a representative of the industry. The Fruit Juice Council is lobbying for the FED to be reduced to 15%, arguing that the move would benefit both the industry and revenues. Meanwhile, another tool used frequently by the FBR is blocking genuine tax refunds to inflate revenues. On Thursday, Special Assistant to the Prime Minister Haroon Akhtar Khan met with a delegation from Utopia Industries to address their pending tax refunds. According to a statement from the Ministry of Industries, Utopia Industries — a leading exporter of mattress covers, pillows, comforters, and plastic products — has been unable to recover more than Rs3 billion (approximately $10 million) despite submitting all required documentation. The company, which began operations in 2020 with a $50 million investment, now ranks among Pakistan's top 12 exporters by revenue and leads in the number of containers shipped abroad. It is also one of the top two sellers on Amazon, with annual revenues of $170 million. All of its products are branded under its own name and carry Pakistani origin labels, distributed widely across households in the United States, Canada, and the UK. According to company officials, Rs600 million in sales tax refunds are pending from the April-January period, despite refund payment orders having been generated. An additional Rs700 million in refunds has been deferred for the same period, and Rs350 million in income tax refunds have been stuck since 2022. Utopia's representatives also met the finance minister in Washington, DC, last October and have filed a complaint with the Federal Tax Ombudsman, but the matter remains unresolved. The company says it has reached out to multiple stakeholders, including the All Pakistan Textile Mills Association, the Pakistan Textile Council, the commerce and planning ministers, and even the Special Investment Facilitation Council and the Pakistani ambassador to the USyet the issue persists.
Time of India
26-05-2025
- Business
- Time of India
City Unveils Rs147 Cr Plan For Footpaths, Pedestrian Crossings Under Mobility Plan
1 2 Nagpur: In a step toward safer streets and smoother traffic flow, the city is planning to roll out a Rs147.2 crore plan to expand and upgrade pedestrian infrastructure. Under Phase 1 of the initiative, 156 kilometres of new footpaths are proposed to be constructed, 32 at-grade pedestrian crossings will be introduced at key junctions, and 17 grade-separated pedestrian facilities will be developed to improve accessibility and safety. Of the total investment, Rs131 crore is earmarked for building footpaths with a minimum width of 1.8m and a standard height of 150mm. These footpaths will be continuous and encroachment-free, with tabletop crossings planned where footpaths intersect roads. Strict enforcement measures are expected to keep the pathways clear and accessible. The remaining funds will go towards at-grade crossings (Rs12.8 crore) and grade-separated facilities (Rs3.4 crore), including foot overbridges with lifts and escalators, and hybrid subways designed with proper drainage systems. Currently, the city has only 347km of footpaths — well short of the 664km recommended as per the CMP 2018. A survey of the 650km road network shows that only 54% of roads include footpaths, underscoring the urgent need for improved pedestrian infrastructure. This plan is not a standalone initiative but part of the city's broader Comprehensive Mobility Plan (CMP), prepared by MahaMetro in collaboration with RITES. The CMP outlines long-term strategies for managing the city's mobility challenges, covering roads, flyovers, public transport, and pedestrian infrastructure. The 32 at-grade crossings have been identified at busy intersections to facilitate safer pedestrian movement at street level. These are expected to improve traffic efficiency and reduce unsafe road-crossing behaviour. Meanwhile, the 17 grade-separated crossings will serve high-footfall areas and major road junctions, offering safer and more convenient options for pedestrians without disrupting vehicular flow. Together, these developments aim to create a safer, more walkable city that supports public transport and reduces pressure on the road network. Once implemented, the plan is expected to not only protect pedestrians but also promote more efficient, inclusive urban mobility.
Business Recorder
21-05-2025
- Business
- Business Recorder
Pakistan's smuggling epidemic
EDITORIAL: For decades, illicit trade and smuggling of goods across multiple sectors have imposed a crippling drain on Pakistan's economy, depriving the national exchequer of vital revenue while nurturing a parasitic shadow economy that has strangled legitimate businesses and stifled growth. The alarming scale of this scourge was underscored last week in a report by the Policy Research Institute of Market Economy and the Transnational Alliance to Combat Illicit Trade (TRACIT), which revealed that Pakistan loses Rs750 billion in tax revenue each year due to rampant smuggling and illegal manufacturing, particularly in sectors like tobacco, petroleum, and pharmaceuticals. Meanwhile, the country's vast informal economy, valued at USD 123 billion, is responsible for an even more severe annual tax loss of Rs3.4 trillion, 30 percent of which stems from the gross abuse of the Afghan Transit Trade facility. Moreover, TRACIT's Illicit Trade Index 2025 ranks Pakistan a dismal 101st out of 158 countries, significantly lagging behind regional peers like India (52) and Sri Lanka (73). The report has further emphasised the country's glaring vulnerabilities in taxation, weak regulatory enforcement and porous supply chains. Pakistan's highly inequitable tax regime, in particular, has played a critical role in fostering this crisis, overburdening legitimate businesses while enabling illicit sectors to flourish without meaningful scrutiny. The tobacco industry exemplifies this distortion perfectly: excessively high tax rates have squeezed formal manufacturers, which contribute 98 percent of the sector's tax revenue, while the illicit sector now controls 56 percent of the market. Far from boosting revenue, higher taxes have led to a nosedive in tax collection, driving consumers towards cheaper, illicit alternatives smuggled effortlessly across Pakistan's porous borders. This brings us to another aspect of this crisis: the sheer volume of counterfeit and contraband products flooding markets, exposing both shocking incompetence and outright corruption by official circles in border management, as well as further down the supply chain, indicating that smuggling networks are operating with near impunity. As far back as December 2023, this newspaper had reported the federal government uncovering a network of mobile phone smugglers and dealers, allegedly supported by multiple departments, including the FBR, FIA, police, FC and PIA. Since then, there has been little meaningful progress in addressing corruption within these agencies, as smuggling persists unchecked across various sectors. The TRACIT report prescribes a multipronged reform agenda that the authorities would do well to urgently adopt, including rationalising of the tax regime to eliminate incentives for smuggling and counterfeit trade, and upgrading of enforcement mechanisms. Despite some improvements in border control measures, domestic market oversight remains weak, necessitating more rigorous market inspections in a bid to crack down on illicit trading activities. The FBR's much-touted Track and Trace system is also in need of more robust implementation. Meant to combat tax evasion by digitally monitoring goods with unique QR-coded stamps, tracking them from factory to sale, the system has faltered due to the widespread use of counterfeit stamps and poor compliance, undermining its effectiveness. Technological upgrades of the system, more exacting audits and stiffer penalties for non-compliance are the needs of the hour. Furthermore, the persistent lack of coordination between Customs, the FBR and security agencies needs urgent redress through the formation of dedicated task forces, streamlined intelligence-sharing and joint operations. Additionally, integrating cutting-edge border management tools, such as high-resolution surveillance drones and automated cargo scanning technology at key transit points and highways, can significantly strengthen the ability of law enforcement to detect smuggling networks. For these measures to have the desired impact, however, Pakistan must first confront the entrenched corruption within its law enforcement apparatus and key departments. Purging institutionalised nexuses between smuggling networks and official circles has become critical. Until this rot is excised, no solution will work. Copyright Business Recorder, 2025
Express Tribune
18-05-2025
- Business
- Express Tribune
Rethinking policies to curb illicit trade
At high tax rates, profit margins for sellers decrease, leaving them with options to pass on the burden to consumers, compromise on the quality of products, evade taxes or find cheaper illicit goods. photo: file Listen to article Illicit trade has emerged as a significant threat to economic stability. Despite an annual tax revenue loss of more than Rs750 billion — and an estimated total tax revenue loss of Rs3.4 trillion considering that one-third of the economy operates informally — the policy response has remained confined to bridging revenue gaps by raising taxes while completely neglecting market distortions. The significant tax burden placed on citizens is a driving factor behind the stronghold of illicit trade in Pakistan. When we talk about illicit trade, a common perception is that this is an enforcement issue. However, in reality, the root cause of this problem is the faulty economic policy. Economic agents develop business practices based on the incentives or dis-incentives created by policies. The ineffective enforcement only complements the problem. This is also corroborated by the Illicit Trade Index 2025 of the Transnational Alliance to Combat Illicit Trade (TRACIT). Illicit trade has gradually become a significant threat to the economy. It not only undermines formal businesses, but also erodes competition and innovation in the market, drains government revenues and exposes consumers to unsafe, counterfeit products. The unconducive business environment created by short-term economic policies creates incentives for malpractices. By economic policies, I am referring to taxes and tariff or non-tariff barriers, both aimed at generating revenues and restricting imports into Pakistan. At high tax rates, profit margins for sellers decrease, leaving them with options to pass on the burden to consumers, compromise on the quality of products, evade taxes or find cheaper illicit goods. For instance, the increase in federal excise duty (FED) on tobacco products in 2023 has created a large and flourishing market for smuggled brands. Aimed to generate revenues, the high taxes shifted demand towards illicit products, depriving the government of Rs300 billion in tax revenues. Now, the market share of illicit cigarettes is 56%. With high tariff or non-tariff barriers, intended to protect local manufacturers or restrict imports, the consequence is not only an increase in prices of imported goods but also lower competition and no incentive to innovate. Moreover, cumbersome regulations and bureaucratic hurdles at ports and borders have added to the costs of legitimate trade without effectively deterring illegal activity. Complex procedures often delay legal imports, while organised smuggling networks exploit gaps in monitoring and control. In many cases, the outdated customs practices and the lack of modern scanning equipment allow illicit goods to move with relative ease. Legitimate businesses suffer as they are forced to compete with cheaper, untaxed products. Investment slows down as investors shy away from markets where the rule of law is weak and unfair competition is rampant. Consumers, on the other hand, experience lower purchasing power and affordability constraints, especially in the last couple of years when inflation remained much higher and real incomes declined. The options available to consumers are low quality but expensive local goods or cheaper but illicit goods. The viable option in most cases appears to be the illicit goods. Enforcement shortcomings further compound the problem. Pakistan's enforcement agencies remain under-resourced and sometimes poorly coordinated. The number of customs and anti-smuggling personnel is insufficient compared to the scale of the problem. Sporadic crackdowns and intelligence-driven efforts have failed to restrict smuggling. In addition, the lack of reliable data and weak inter-agency cooperation hamper efforts to track and control illicit flows effectively. Addressing illicit trade requires a comprehensive and coordinated approach. To begin with, tax and trade policies should be rationalised to ensure that taxes and duties are set at levels where compliance becomes economically viable rather than burdensome. Pakistan must strengthen enforcement by significantly increasing resources and personnel, particularly at the retail level where illicit goods reach consumers. At the same time, technology must be upgraded by strengthening systems like Track and Trace and equipping law enforcement agencies with modern tools to authenticate tax stamps and verify the legitimacy of goods. Finally, inter-agency coordination must be enhanced to ensure that the Pakistan Customs, Federal Board of Revenue (FBR), provincial excise departments and security agencies work together strategically, sharing information and resources to dismantle illicit networks more effectively. Combating illicit trade is not simply about policing; it is about restoring the economic foundations that drive business behaviour. Rationalising tax and trade policies, strengthening enforcement, modernising technology and fostering better coordination across agencies are crucial to address this issue. Pakistan must recognise that illicit trade is not just a fiscal loss but a deeper economic distortion that weakens businesses, undermines consumer welfare and erodes public trust. Without decisive action, the parallel economy will continue to expand, dragging formal growth and prosperity down with it. The writer is a Research Economist at the Policy Research Institute of Market Economy (PRIME), an independent economic policy think tank
