PESHAWAR, Nov 28: As top leaders from the Awami National Party facilitated passage of legislation on RGST in the Senate, here in Peshawar their business colleagues are refusing to accept it, uncovering clear division in the business community over this controversial levy.

On Friday ANP Senators Ilyas Ahmad Bilour and Haji Muhammad Adeel, who spearhead two rival business groups in Peshawar, supported the RGST bill in the Upper House, which many believe will make things difficult for them to manage at local business politics.

“The government had accepted most of the demands of ANP, so it had to support the bill in the Upper House,” Mr Bilour told Dawn , when approached for comments.

The trading community, he conceded, and most of members of his group were against the RGST, adding “I have conveyed their reservations to the government and that was why most of the recommendations of our party had been accommodated in the committee.”

Mr Bilour, who leads Businessman Forum of Pakistan, said the federal government had agreed that it would not tax any food item whether packed or non-packed except those already taxed in the sales tax law of 1990 on ANP's demand.

Likewise, medicines, stationery items and children school materials had also been exempted from the RGST on ANP recommendations, explained Mr Bilour. He, however, doubted the FBR's ability to collect this tax because the trade sector is largely undocumented.

“Country has foreign commitments and there is no alternate to RGST, so what we can do now is to facilitate talks between traders and government, if they want,” explained Mr Bilour.

Sharafat Ali Mubarik, the president Markazi Tanzeem-i-Tajiran Khyber Pakhtunkhwa and senior leader of Mr Bilour's Businessman Forum Pakistan, rejected the move, saying “Imposition of RGST is unacceptable to the traders in any case and we will give a call for shutter-down if the government did not back out.”

Talking to the Dawn , Mr Mubarik explained that the traders were not in favour of RGST because the government had not taken them into confidence before moving this controversial law.

The traders, already bearing the brunt of militancy and recent floods, were not in position to bear any new tax so a phased wise protest drive had been planned in the province, he said.

In the first phase, he said, black flags and banners had been displayed in all the markets, while protest demonstrations and shutter down strikes would also be observed.

“We consider all the political parties, which staged walkout or abstained from voting, as supporters of the RGST,” remarked Mr Mubarik.

The Sarhad Chamber of Commerce and Industry (SCCI) had already rejected the RGST and announced putting its weight behind the trading community that had already initiated a protest campaign against this levy.

The SCCI President Usman Bashir Bilour also rejected the RGST and explained that the federal government had not taken the business community into confidence while formulating this law.“Traders are against RGST and so is the SCCI,” remarked Mr Bilour, adding, “Our main reservation is that FBR doesn't have the capacity and methodology to collect such tax. Just have a look at the so-called audits instituted against businesses just to raise revenue.”

Senator Mohammad Adeel, who was senior vice-president of ANP and senior leader of rival Businessman Panel Pakistan, also claimed to have secured 80 per cent gains in the proposals of the committee of the parliament on the RGST approved by the Senate.

Apart from getting exemptions on medicines, food items and education material, Mr Adeel said, we made the federal government accept that flood tax would not be recovered from Khyber Pakhtunkhwa.

Haji Haleem Jan, president of rival traders' association that enjoys Mr Adeel's backing, came down hard on ANP leaders' stance in the Senate, saying “they have betrayed the local business community by supporting the RGST.”