In Pakistan, manufacturers & exporters lament delay in disbursement of tax refunds
PRGMEA says exporters are facing severe liquidity crunch owing to long delay in refunds
Representational image. PHOTO: REUTERS
LAHORE:
The Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has expressed disappointment over the performance of the Federal Board of Revenue’s (FBR’s) newly-launched Fully Automated Sales Tax e-Refund (FASTER) System because the commitment of the government to release exporters’ refunds within 72 hours has not been fulfilled yet.
“PRGMEA welcomes Prime Minister Imran Khan’s directives to the FBR to clear the pending refunds of exporters and to remove bottlenecks from the new refund payment system,” said PRGMEA (North Zone) Chairman Sohail Sheikh in a statement issued on Saturday.
He requested the prime minister for swift implementation of his orders as the exporters were facing a severe liquidity crunch owing to countless delays in payment of sales tax refunds despite the launch of the new FASTER system by the FBR.
“Timely payment of refund claims still remains a major issue and need resolution on a priority basis,” he said. “Despite the FBR’s commitment of disbursing sales tax refunds within 72 hours of submission of claims, billions of rupees of exporters are still stuck.” He lamented that the amount of stuck up sales tax refunds has crossed Rs100 billion since the announcement of FBR’s new system in July 2019 following the withdrawal of zero-rating regime.
The total sales tax refund claims have touched around Rs350 billion, he noted.
Talking about enhancing exports, he said it was a very important objective as far as improvement of the economy was concerned; hence it should be the utmost priority of the government to facilitate exporters in every possible way. “Exporters are unable to procure and purchase raw material and other accessories to fulfil future orders and this will ultimately lead to collapse of the entire export industry,” he added.
Sheikh regretted that the initial stages of FASTER system carried several flaws due to which exporters faced immense hardships in filing sales tax returns. “These issues were shared with the relevant authorities within the FBR but despite repeated assurances, deficiencies are still present in the system, which makes submission of refund claims impossible.”
“Every time the deadline for disbursement of sales tax refunds lapses, a new date is announced but the promise is never fulfilled,” the chairman criticised. He added that high inflation has dented the purchasing power of the common man due to which business activities had dipped significantly.
Published in The Express Tribune, January 5th, 2020.
The Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has expressed disappointment over the performance of the Federal Board of Revenue’s (FBR’s) newly-launched Fully Automated Sales Tax e-Refund (FASTER) System because the commitment of the government to release exporters’ refunds within 72 hours has not been fulfilled yet.
“PRGMEA welcomes Prime Minister Imran Khan’s directives to the FBR to clear the pending refunds of exporters and to remove bottlenecks from the new refund payment system,” said PRGMEA (North Zone) Chairman Sohail Sheikh in a statement issued on Saturday.
He requested the prime minister for swift implementation of his orders as the exporters were facing a severe liquidity crunch owing to countless delays in payment of sales tax refunds despite the launch of the new FASTER system by the FBR.
“Timely payment of refund claims still remains a major issue and need resolution on a priority basis,” he said. “Despite the FBR’s commitment of disbursing sales tax refunds within 72 hours of submission of claims, billions of rupees of exporters are still stuck.” He lamented that the amount of stuck up sales tax refunds has crossed Rs100 billion since the announcement of FBR’s new system in July 2019 following the withdrawal of zero-rating regime.
The total sales tax refund claims have touched around Rs350 billion, he noted.
Talking about enhancing exports, he said it was a very important objective as far as improvement of the economy was concerned; hence it should be the utmost priority of the government to facilitate exporters in every possible way. “Exporters are unable to procure and purchase raw material and other accessories to fulfil future orders and this will ultimately lead to collapse of the entire export industry,” he added.
Sheikh regretted that the initial stages of FASTER system carried several flaws due to which exporters faced immense hardships in filing sales tax returns. “These issues were shared with the relevant authorities within the FBR but despite repeated assurances, deficiencies are still present in the system, which makes submission of refund claims impossible.”
“Every time the deadline for disbursement of sales tax refunds lapses, a new date is announced but the promise is never fulfilled,” the chairman criticised. He added that high inflation has dented the purchasing power of the common man due to which business activities had dipped significantly.
Published in The Express Tribune, January 5th, 2020.