Lahore: A Pakistan Business Council (PBC) member has expressed concerns that the exclusion of engineering services from the government’s reduced withholding tax facility will hinder the construction sector — a news source reported. Earlier, the tax rate had been reduced to 3%; however, it has once again been raised to 8% of the value of services.
The PBC member further stated that the exclusion of engineering services would mean very high tax rates, particularly for the corporate sector that provides engineering services to the energy, oil, gas, and construction sectors.
Reportedly, the decision to increase the tax goes contrary to the government’s previous announcement to boost construction and low-cost housing, as this move will ultimately result in high cost of construction and business. A number of engineering companies have reached out to the government — both directly and with the help of a number of business platforms — in order to urge it to alter its decision. The firms contend that this is the only choice this faltering sector has of recovery in the future.
