Pakistan, May 22 -- Commercial importers have urged the federal government to remove the wide tax gap between commercial and industrial imports, arguing that the current structure is damaging fair competition and encouraging undocumented trade practices. Industry representatives said the tax differential on raw material imports currently ranges between 26% and 28%, making it increasingly difficult for genuine commercial importers to survive in the formal market.

Importers claimed that many goods were being imported under the names of industrial units and later sold openly in domestic markets to avoid higher commercial import taxes. As a result, they warned that the practice was depriving the government of billions of rupees in potential ...