Millat Tractors suspends production amid GST refund issues

WEB DESK: Millat Tractors Limited (MTL), a prominent manufacturer in Pakistan’s agricultural sector, has temporarily suspended its production operations due to unresolved issues related to GST refunds, according to a filing made by the company to the Pakistan Stock Exchange (PSX) today.

The company disclosed that while the GST on tractors is set at 10 per cent, the GST on the raw materials required for production is 18 per cent, creating a backlog of refund claims. Despite repeated requests for clarity, the government has yet to establish a mechanism for processing these refunds.

As a result of these ongoing challenges, MTL has decided to halt production until further notice.

Last week, MTL addressed rumours regarding disruptions in its supply chain.

A media report published on August 9, suggested that the company’s vendors had stopped supplying tractor parts, leading to operational difficulties.

However, MTL categorically denied these claims in a statement to the PSX on August 12. The company clarified that no vendor had ceased operations and assured stakeholders that it would promptly notify the stock exchange if any such issue were to arise.

MTL reiterated that the current production halt is solely due to the ongoing issues with GST refunds and not related to any supply chain disruptions.

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