ISLAMABAD: The strike by flour mills continues for the second day, with flour mills across the country remaining closed on Friday.
The Flour Mills Association has announced that the strike will persist until their demands are met.
However, the owners of small flour grinding units, known as “chakkis,” have disassociated themselves from the strike.
In Karachi, work continues at 2,500 flour chakkis, but there are fears of a flour crisis due to the flour mills’ strike. Supply to Jodia Bazaar, a major flour market in Karachi, has been halted, and stocks are running low.
Background and Developments
On Thursday, flour millers initiated the strike after talks with the government failed. The Flour Mills Association called for an indefinite strike following unsuccessful negotiations with the government to revoke the withholding tax.
The association’s office-bearers vowed to continue the strike until their demands were met, highlighting that existing taxes were already burdensome and the new tax imposition was unjustified. They emphasized that all flour millers across the country were united on this issue.
Last Wednesday, flour mills nationwide stopped washing and crushing wheat in protest against the imposition of withholding taxes 236G and 236F. The association chairman, Asim Raza, announced that flour supply would be halted starting July 11 and would remain suspended until the tax was withdrawn.
Impact of the tax imposition
Asim Raza explained that the imposed tax rates are 0.10% on filer wholesalers, 0.50% on filer retailers, and 5.5% on flour mills, which would raise the price of a 20 kg flour bag by 106 rupees. Refined flour and fine flour prices would also increase by 460 rupees per bag.
He further mentioned that the wholesale and dealership network for flour mainly consists of small shopkeepers, most of whom are non-filers. The tax rates imposed on non-filer dealers are 2%, on non-filer retailers are 2.5%, and on flour mills are 5.5%, which would increase the price of a flour bag by 185 rupees and other products like refined flour and fine flour by 800 rupees per bag.
