The Federal Budget 2011-12 has started taking its toll on sugar prices. Mirroring previous trends, sugar prices have soared Rs 3 per kilogramme in the provincial capital during the last three days, sources told Pakistan Today. Sugar dealers in the largest wholesale market of the province, Akbari Market, indicated that despite no change in taxes on sugar in the federal budget, prices of the sweetener had started increasing only a couple of days after the budget. Dealers said earlier sugar was available between Rs 64 and Rs 65 per kilogramme at the wholesale level, but it had jumped to Rs 67 to Rs 68 per kilogramme after the budget announcement. Speaking to Pakistan Today, Lahore Sugar Dealers Association Chairman Asghar Butt said apparently there was no obvious reason for an increase in sugar price, but every player in the sugar supply chain, from miller to trader, was making money by appreciating prices.
Asghar said sugar was taxable at the reduced rate of eight percent at local supply stage. However, the government had withdrawn this rate with exemptions been granted to white crystalline sugar. This meant there was no change in taxes on sugar. Muhammad Aslam, a shopkeeper from the Islampura area, said that traders had managed to inflate sugar and other commodities’ prices owing to ineffective price control. He said traders and dealers were blaming sugar millers for the price increase, but millers termed it a demand and supply phenomenon hence no one took responsibility of the inconvenience caused to the common man.
