PVMA Urges Government to Remove Sales Tax Section 8B for Ghee & Cooking Oil Industry in Upcoming Budget

Karachi – Sheikh Umar Rehan, Chairman of the Pakistan Vanaspati Manufacturers Association (PVMA),
has urged the federal government, Finance Minister Senator Muhammad Aurangzeb, and the Chairman
of Federal Board of Revenue (FBR) to abolish Section 8B of the Sales Tax Act for the edible oil and ghee
industry in the upcoming federal budget.
Currently, Section 8B mandates the advance withholding of 10% of input costs, which Sheikh Rehan
described as an unfair burden on an industry that deals with essential food products. "This clause should not apply to the edible oil and ghee sector, which is already under immense financial pressure due to multiple layers of taxation," he said.
He emphasized that the industry is grappling with rising production costs, which it can no longer sustain.
One of the key challenges, he noted, is the delay in the release of billions of rupees in sales tax refunds,
currently held up by the FBR. "Timely disbursement of these refunds is essential to ensure
manufacturers have the working capital they need," Rehan added.
He explained that if refunds are paid on time, the industry would not need to rely on expensive bank
loans, which would significantly lower production costs. “Ultimately, this would lead to a reduction in
the prices of ghee and cooking oil — benefiting consumers directly.”
Sheikh Umar Rehan stressed that if the government aims to curb inflation, it must adopt industry-
friendly policies. He highlighted the removal of Section 8B and the prompt payment of sales tax refunds
as critical steps toward stabilizing the edible oil sector and providing economic relief to the public.
He urged the government to prioritize these demands in the forthcoming budget to ensure the
sustainability of the sector and affordability for consumers.