Flour mills across several cities in Pakistan have ceased wheat grinding and flour supply starting today (Thursday), raising concerns about an impending flour crisis. This action comes as part of a strike against the recently imposed withholding tax.
In the budget for 2024-25, the government has introduced a withholding tax on various stages of the staple food supply chain, reaching up to 5.5%. Leaders of the Pakistan Flour Mills Association (PFMA) argue that this tax will increase the cost of flour.
The Central Senior Vice Chairman of PFMA stated that mills are also being required to collect an additional 2.5% and 2% withholding tax on flour sales from non-filer retailers and wholesalers, respectively.
PFMA Chairman Asim Raza reported that approximately 1,500 flour mill owners have joined the strike. He emphasized that the mills would not take on the responsibility of collecting the withholding tax, which would raise the price of flour by Rs200.
The strike has led to significant disruptions:
- In Gujranwala district, all 73 flour mills are completely shut down.
- In the Multan Division, all 100 flour mills are closed, including 60 in Multan.
- In Faisalabad, the supply of 200,000 bags of flour per day has stopped due to mill closures.
- In Kamalia city, all 10 flour mills are closed, as are four mills in Khushab district.
- Peshawar and Quetta are also observing the strike, with mills locked.
PFMA Chairman (South Zone) Aamir Abdullah announced that flour mills in Sindh had halted wheat grinding and flour supply as well. He stated, “Tax collection is the FBR’s job, we should not be made tax agents. Until our demands are approved, the supply of wheat products will remain closed.”
The PFMA warns that a prolonged deadlock between the government and the association could lead to a scarcity of flour. As a result, the production of 5kg, 10kg, and 20kg flour bags has been halted from today.
A few days ago, flour mill owners had announced the strike at a press conference, following unsuccessful negotiations with the government to address their concerns.
