Ghee makers threaten shutdown amid tax dispute

July 24, 2025 (MLN): The Pakistan Vanaspati Manufacturers Association (PVMA) has issued a 48-hour ultimatum to the government, demanding the withdrawal of certain powers granted to the Federal Board of Revenue (FBR) or face an indefinite halt in ghee production nationwide.

At a press conference following a general body meeting held at a local hotel, PVMA Chairman Sheikh Umar Rehan stated that the association has delayed its planned strike for 48 hours due to ongoing negotiations with the Special Investment Facilitation Council (SIFC).

However, he made it clear that ghee mills across the country would shut down if the government fails to respond within the given deadline, according to the press release issued.

“All our members have unanimously given a mandate for an immediate strike. We are making a final attempt to resolve issues through dialogue. If that fails, we will be left with no choice but to act,” said Rehan.

The general body meeting was attended by senior industry figures including Khalid Islam, Masood Pervaiz, Asjad Arif, and Rashid Jan Mohammad.

During the meeting, PVMA highlighted several critical issues.

These included alleged harassment by FBR officials stationed at ghee mills, who have reportedly been demanding business records beyond legal limits.

The association also raised concerns about what it described as an unjustified tax burden, with the industry currently paying 45% in total taxes, 35% in import duty and 10% in advance tax.

Another major concern is the Rs6.5 billion reportedly owed to ghee manufacturers by the Utility Stores Corporation.

Additionally, PVMA stressed the industry’s lack of readiness for mandatory digital invoicing due to inadequate digital infrastructure.

Particular opposition was voiced against the FBR’s enforcement powers under Sections 40B and 40C, especially regarding the real-time digital monitoring of transactions exceeding Rs200,000.

PVMA called these measures excessive and unworkable under the prevailing conditions.

Rehan questioned the accountability of the FBR, stating, “If a NAB officer were placed in the FBR Chairman’s office, would he be able to work effectively?”

Frustration over failed dialogue also emerged, with PVMA Vice Chairman Masood Pervaiz expressing disappointment in a recent meeting in Islamabad.

He noted that the FBR Chairman reportedly delegated discussions to a junior official and excused himself for another commitment, leaving the association’s concerns unaddressed.

The PVMA has made it clear: unless the government resolves the industry's grievances within the 48-hour window, the sector will initiate a complete shutdown of ghee production across Pakistan.

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