PoGB traders warn of protest over tax collection issue

The local traders of Pakistan-occupied Gilgit Baltistan (PoGB), who manage their livelihoods from the goods passing through the Sost Dry Port, have been protesting for several weeks over the issue of illegal tax collection despite the PoGB’s chief court ordering otherwise.

These protestors in a press conference on Wednesday late night warned the authorities to either vacate the port premises, resolve their issue within two days, or be ready to face a major protest, WTV, a local news organisation from PoGB, reported.

Notably, the court had issued a stay order preventing customs authorities from collecting various taxes at the Sost border station until a final decision was reached.

The press conference was headed by Mauhaumad Javed, a former Member of the Legislative Assembly (MLA) of PoGB. During the press conference, the leader mentioned that the authorities were trying to provoke the traders to violence. He said, “Traders will not back down at any cost. What has been ordered by the PoGB court must be followed at all costs.”

In his statement in the WTV report, the MLA stated, “If the tax authorities are capable of accepting the court orders, then only they must run the affairs here. Otherwise, they are welcome to leave. If our demands are not met, the situation will get worse. We urge the authorities, not to force our hands to strengthen our protest. Such a situation will bring the government into question. We are ready for a two-day protest during which we will block the operations of the China-Pakistan Economic Corridor (CPEC) and the dry port.”

The MLA also said that the taxation authorities of the Sost Port must leave the premises if they are not able to handle our issues according to the law. Moreover, only the authorities and the government will be held responsible if the situation takes a turn for the worse.

While condemning the government for its ignorance over the matter, the MLA, according to the WTV report, said, “If the people in power are not ready to listen to my issues, then I am also not concerned about what they say. If the powerful people remain ignorant of the issues of PoGB, then the situation will only get worse, and I believe this will soon happen. And if they are not ready to listen to the people and local leaders, they are not fit to run the government.”

The taxation issues in Pakistan, especially in regions like PoGB, are complex and layered.

Traders frequently encounter inconsistent enforcement of tax laws, which leads to confusion and disputes. Frequent changes in tax policies further complicate compliance, making it both expensive and difficult for traders to adhere to new regulations.

Despite court rulings against specific taxes, enforcement is hindered by delays and resistance from authorities. Additionally, corruption among tax officials–such as demands for bribes or facilitation payments–adds to the challenges and costs of compliance. Delays in processing tax documents and refunds also worsen cash flow problems for traders, making effective business operations even more difficult.

Pakistan mainly exports raw materials and agricultural products, while it imports a diverse range of manufactured goods, machinery, and technology from China.