KARACHI: The reintroduction of zero-rated regime is a positive step towards the restoration of the ailing textile sector, as this sector contributes more than 55% of foreign exchange earnings, said All Pakistan Textile Mills Association (APTMA) Chairman Tariq Saud on Saturday.
In a statement, Saud said that APTMA had demanded zero-rating and had met Finance Minister Ishaq Dar on Sunday in this regard. They convinced him that the viability of the textile industry is important for economic growth of the country.
APTMA chairman thanked Dar, for understanding the issues of the industry. He said that he is hopeful that the government would implement the directive in true letter and spirit. He also appreciated the reduction in export refinance rate by 0.5%.
“The government should announce a comprehensive package for the textile industry as its exports are under pressure both in terms of quantity and value,” said Saud.
He said the high cost of doing business and an unrealistic value of the local currency also played a role in this regard. The textile industry was unable to utilise resources due to losses sustained earlier and now a liquidity shortage was a major hurdle to produce exportable surplus.
Saud urged the government to liquidate pending sales tax refunds by the end of July as promised by the finance minister so that funds, presently lying unproductive, could be used to meet working capital requirement of the industrial operations.
He demanded complete withdrawal of Gas Infrastructure Development Cess (GIDC), electricity surcharges from entire textile chain and 5% Drawback on Local Taxes and Levies (DLTL) against exports to all textile value chain.
He also urged the government to remove incidentals of taxes, cess, levies and duties on all textile exports and provision of Long Term Financing (LTF) Facility to entire textile chain to attract fresh investment and balancing modernisation and replacement (BMR) of the existing plants and machineries.
To safeguard the domestic commerce from under invoiced imports, government should levy 15% Regulatory Duty on Synthetic Yarn and Fabrics under Chapter 55, he said.
Published in The Express Tribune, June 5th, 2016.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ