The government of Khyber-Pakhtunkhwa is pushing forward with a plan to revamp its royalty structure on cement manufacturing, shifting from an ore-based calculation to a bag-based formula. The move, which would bring the province in line with Punjab, is poised to significantly increase costs – the effective tax rate is going up six times the current rate – for cement manufacturers operating in Khyber-Pakhtunkhwa. However, as seen in Punjab, where cement firms successfully obtained a stay order against a similar policy, the legal fate of this proposal appears to be a foregone conclusion.
If implemented, the new royalty structure would have two major consequences: an inevitable increase in cement prices—driving up construction costs in the province—and a likely court battle that could delay or nullify the measure. The precedent set by Punjab’s manufacturers suggests that the latter is the more probable outcome. The content in this publication is expensive to produce. But unlike other journalistic outfits, business publications have to cover the very organizations that directly give them advertisements. Hence, this large source of revenue, which is the lifeblood of other media houses, is severely compromised on account of Profit’s no-compromise policy when it comes to our reporting. No wonder, Profit has lost multiple ad deals, worth tens of millions of rupees, due to stories that held big businesses to account. Hence, for our work to continue unfettered, it must be supported by discerning readers who know the value of quality business journalism, not just for the economy but for the society as a whole.To read the full article, subscribe and support independent business journalism in Pakistan
