The Sindh government on Tuesday formally announced it would not collect withholding tax for the federal government from July 1. The Sindh Excise Department has written a letter to the inland revenue commissioner in this regard.

The move will add to already tense relations between the Sindh government led by the Pakistan People’s Party (PPP) and the federal government led by the Pakistan Tehreek-e-Insaf (PTI).

The provincial government has told the federal government to make arrangements on its own to collect withholding tax from the taxpayers in Sindh. Earlier, the Sindh cabinet had approved the government’s decision to stop collection of withholding tax for the federal government.

Talking to reporters during his visit to the Pakistan Stock Exchange a day after it came under a terrorist attack in Karachi, Sindh Governor Imran Ismail said it was beyond comprehension that a province would not collect taxes for the federation. He said that Sindh Chief Minister Syed Murad Ali Shah should either take his words back or give a reason for the provincial government’s decision.