KARACHI: Pakistan Ship`s Agents Association (PSAA) has demanded immediate removal of freight tax, citing that it is not only impacting the country`s external trade negatively but also acting as a hurdle in attracting investment to the ship-owning industry.
The freight tax 8 per cent, imposed under Section 7 of Income Tax Ordinance 2001 has been a cause of extra cost for shipping industry and external trade. In a letter addressed to Federal Minister of Maritime Affairs Ali Zaidi, Chairman PSAA Tariq Haleem pointed out that there is an urgent need to remove the freight tax which has been a major cause of high cost of doing business in the shipping industry.
The other area facing the negative impact of freight tax is the imports and exports.
Traders, in order to evade this 8 per cent t ax, have adopted various tactics which are directly affecting the foreign exchange reserves, he added.
Once the freight tax is removed, it will not only help in ease of doing business, but reduce the cost of doing business as well as attract more foreign exchange and investment to the ship-owning industry.
