Sindh

Pakistan’s current tax policies are putting heavy pressure on the Fast-Moving Consumer Goods (FMCG) sector, especially the food industry, according to Hyderabad SITE Association of Trade and Industry Chairman Zubair Ghangra. He said the Federal Board of Revenue’s withholding and advance tax system has become a major challenge for industrial growth and business survival.

Speaking about the issue, Ghangra said the taxation structure has created serious operational difficulties across the supply chain. Manufacturers, wholesalers and distributors are facing increasing financial pressure, while a large section of the retail market continues to operate outside the documented economy.

According to Ghangra, thousands of unregistered retailers are functioning without proper accountability, forcing registered businesses to bear most of the tax burden. He said this imbalance has increased operational costs for organised companies that are already struggling with inflation and declining consumer demand.

The industry leader explained that excessive documentation and compliance rules have also complicated business operations for FMCG and food companies. He said companies working with limited profit margins are facing disruptions in cash flow management and additional administrative burdens because of the existing tax system.

Ghangra warned that these rising operational expenses are eventually transferred to consumers, contributing to higher prices and growing economic instability in the country. He criticised the current taxation model for discouraging formal business practices while indirectly supporting the expansion of undocumented trade activities. Ghangra said unfair taxation burdens registered businesses while unregistered traders escape scrutiny, urging authorities to reform policies and expand the tax base for balanced economic growth.