KARACHI, March 15: Rice Exporters Association of Pakistan (REAP) vice-chairman Shaikh Arshad Mahmood has drawn the attention of the member direct taxes, CBR, towards the fact that banks are still deducting 1.25 per cent withholding tax on packings above five kilograms.

In a statement issued on Monday, he said that despite the fact that the ministry of finance through a notification on November 17, 2003 changed the word fifty with the word five kilograms for the packing, but the banks continue to charge higher withholding tax.

The ministry, he said, had amended the extent of packing up to 50 kilograms, and by the virtue of the amendment all rice marketed under a brand name up to 50 kg packs would be charged 0.75 per cent withholding tax.

Mr Mahmood said that commercial banks argue that they did not receive the copy of the notification (SRO 1053(I)/2003 dated 17.11.2003) and are unable to deduct as per the SRO.

The REAP vice-chairman has requested the member direct taxes to ensure delivery of the notification to the banks so that exporter do not suffer on this account.