Exporters open CDC accounts for tax refund

KARACHI: Around 600 exporters have opened investor accounts at the Central Depository Company (CDC) to receive tax refunds.

It is mandatory for exporters who have submitted claims for sales tax refunds to maintain a CDC account. Earlier, the cash-strapped government told exporters that it would issue them provisory bonds against their sales tax refund claims as it remained short of cash. The bonds are being deposited at CDC accounts. Some 90 exporters have so far received provisory bonds worth Rs7 billion in their CDC accounts. The bonds would mature after three years from the date of issuance; meaning bond holders could convert them into cash. Bond holders would receive 10% rate of return per annum.

The bonds of value Rs100,000 each are transferable and can be deposited as collateral with banks to acquire loans. Refunds to the 600 CDC accountholders are estimated to total around Rs45 billion. The exporters, who are much more than just 600 nationwide, estimated total refund claims worth nearly Rs200 billion.

The government would issue provisory bonds to more exporters on June 21, an office-bearer of Towel Manufacturers and Exporters Association said.

The association has set up a desk to facilitate its members in opening investor accounts at CDC.

Published in The Express Tribune, June 2^nd, 2019.

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