Hosiery makers seek duty drawback procedure

Latest PM’s export package was approved in October without SBP circular

LAHORE: The Pakistan Hosiery Manufacturers Association (PHMA) has asked the central bank to issue the detailed procedure for applying drawback of duty and taxes (DDT) claims under the revised PM’s export package, as the State Bank of Pakistan (SBP) has not yet formulated the process of application for DDT.

PHMA Chairman Khurram Anwar Khawaja said that the ECC had approved the revised package for exporters in early October and the textile ministry had notified this immediately. But even after a lapse of almost one and half month, he said no detailed circular was issued by the central bank regarding procedure of drawbacks.



He also asked the government to provide complete and 100% drawback rate of incentive to the eligible value-added textile exporters on shipment basis as promised by the authorities, abolishing the condition of increasing exports by 10% or more. Khawaja asked the government to clear all the pending claims on an immediate basis, as huge drawback claims exporters in previous Duty Drawback of Taxes Order 2017 are still pending with the government while a new Order 2017-18 has been issued for which the procedure from SBP is still awaited.

He said that the government had previously assured of providing a 100% drawback rate of incentive for eligible textile exporters on the same terms as those outlined for the period from January 1 to June 30, 2017, without conditions of increment, for the period from July 1, 2017 to June 30, 2018.



However, the relevant notification, issued by the government, says that 50% of the rate of drawback will be provided without condition of increment while the remaining 50% will be provided if the exporter achieves an increase of 10% or more in exports during performance year (FY 2017-18), as compared to the base year (FY2016-17).

While giving recommendations to improve the disbursement mechanism in duty drawback of taxes scheme, he proposed that the incentive amount should be directly credited to the exporters’ account at the time of realisation of export proceeds and SBP may subsequently claim the amount from the government.

Published in The Express Tribune, November 29^th, 2017.

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