Addressing woes: With sales tax refund stuck, exporters face crunch

Apparel forum chairman blames FBR for problems of industry.

Our Correspondent January 16, 2015
Apparel forum chairman blames FBR for problems of industry. PHOTO: ONLINE

KARACHI: Citing the dire state of the country’s clothing exports, Pakistan Apparel Forum Chairman Muhammad Jawed Bilwani has said around Rs50 billion have been stuck in sales tax refund and customs rebate claims, creating severe problems for the industry.

“The already burdened exporters are now trying hard to make both ends meet. This alarming situation is now adversely affecting exports of the value added textile sector,” he said on Friday.

He said that the Federal Board of Revenue (FBR) would earlier hold 25% amount of sales tax refund claims of the exporters. “But, now they are also withholding the amount of sales tax paid on utility bills.”

The value added sector has never faced such hardships in the last two decades, he added.

According to Bilwani, FBR’s reaction to the situation is more astounding as its senior officials refuse to meet essential stakeholders, thus making no effort to address the problems.

“These stakeholders are the highest taxpayers of the country and are working towards generating employment opportunities and earning foreign exchange.

“It seems that the FBR is purposely bent on harassing exporters,” said Bilwani. He lamented that FBR is meeting its tax collection target by withholding huge amount liquidity purposely.

Accusing the government, Bilwani said that despite the PML (N) having a reputation of a business friendly government, it is creating several problems for exporters.

He said exporters, who are otherwise required to analyse global markets
and keep up with the innovative trends, are busy work-
ing hard to receive their refunds.

“The continuous problems in the release of refunds are compelling exporters to limit their operations and this will eventually result in the closure of mills,” he added.

Published in The Express Tribune, January 17th,  2015.

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