ISLAMABAD: The Advisory Council of the Fertiliser Manufacturers of Pakistan has asked the government to settle subsidy claims worth Rs20.67 billion through allocations in the upcoming budget in order to resolve the cash flow issues faced by the sector.

In its proposals for the budget 2019-20, the council has proposed reduction of general sales tax (GST) on all industrial input including feed and fuel gas for all fertiliser products to zero per cent with no revenue loss to the government.

Moreover, GST on sulphur, used as a raw material input in production, Liquefied Natural Gas (LNG) and supply of re-gasified LNG should be reduced to zero per cent, the council proposed.

The council demanded that additional sales tax on import of DAP and other fertiliser by manufacturers should be abolished to improve availability and affordability of phosphatic fertiliser in the country.

The fertiliser council has also suggested revisions in the duty structure and sales tax rates of fertiliser micronutrients in order to align their rates with other fertiliser imports.

The fertiliser sector should be included in the list of top priority sectors alongside other export sectors so that manufacturers can benefit from sales tax refunds given their key role in developing the agricultural economy, the council demanded.

Moreover, it also asked the government to bring fertiliser imports by manufacturers under the normal tax regime in line with the Fertiliser Policy 2001.

It further proposed that the farmer education expenses should be treated as research and development expenses for taxation purposes and should attract tax credit and joint efforts on public-private partnership basis should be undertaken for farmers’ education.

Moreover, active support from agriculture departments should be extended.

Published in Dawn, May 15th, 2019