Lahore: The Lahore Chamber of Commerce and Industry, through its Senior Vice President Zafar Mahmood Chaudhry, has called on the government to urgently address the challenges facing the tractor industry. This appeal was made during a meeting with Muhammad Naeem, Vice President of the Tractors Dealers Association of Pakistan, emphasizing the need for clear policy directives to prevent further plant shutdowns and massive job losses.

According to Lahore Chamber of Commerce and Industry, the tractor industry is in turmoil due to ambiguous policies regarding the General Sales Tax (GST) imposed by the Ministry of Finance and the Federal Board of Revenue (FBR). These uncertainties have already led to the closure of several tractor manufacturing plants, threatening the livelihoods of millions. The delegation highlighted the severity of the issue, noting that the industry is owed billions in unpaid refunds by the FBR, exacerbating the financial strain.

As the sector navigates these challenges, the tax structure has undergone several changes. Previously, the GST on agricultural tractors was 5%, and on parts, it was 17%. However, a new tax regime introduced from July 1, 2024, has set the tax on tractors at 10% and on parts at 18%. The Millat Tractors Association of Pakistan has urged the government to provide a definitive policy framework to facilitate the reopening of closed facilities and help curb rising unemployment within the sector.