KARACHI: On Thursday, Millat Tractors Ltd. (MTL) will start up production again.
The company announced in a public filing on Tuesday that sales would remain restricted until the Federal Board of Revenue (FBR) provided clarification on the process and applicability of sales tax refunds.
On August 22, MTL decided to halt tractor production until further notice since the government had not yet provided a system for paying refund claims.
Tractors are subject to ten percent general sales tax (GST) and eighteen percent GST on all input raw materials. This leads to an ongoing flow of refunds.
The company issued a warning on August 12 that only agri-loan customers were being accommodated for tractor bookings and sales. Consequently, fully constructed units were accumulating, and working capital was being reduced.
Compared to 1,506 and 1,656 units in July 2023, MTL assembled 979 units and sold 605 units in July.
