Proposed gas tariff hike faces opposition

Industrialists say textile sector will have to bear burden of Rs25b

FAISALABAD: Opposing a proposed 30% increase in gas tariff, industrialists in Faisalabad have argued that the textile sector will have to bear an additional burden of Rs25 billion.

Faisalabad Chamber of Commerce and Industry (FCCI) Acting President Nadeem Allahwala said the textile sector was already under financial stress considering that the cost of doing business for the sector has increased manifold due to taxes and exorbitant increases in prices of utilities and raw material.

“Despite the decline in textile exports and energy crises, the  government has increased sales tax up to 27% while it has already collected Rs92 billion under the head of gas infrastructure development charges.”

He expressed dismay and said that the business community has neither been consulted nor taken into confidence regarding the gas tariff.  He said that the FCCI has repeatedly requested the government to take the business community into confidence before taking such steps which are directly related to the economic viability of the industry.

Elaborating, he said the proposed increase of Rs262 per mmbtu will escalate the cost of production by 20% and textile exports have already seen a decline of five percent over the nine months of the ongoing fiscal year. “How will we be able to compete with India and Bangladesh?” he said, adding that if the government wants more revenue, it should cut down unnecessary expenses and collect tax from 0.15 million non-tax payers to whom notices have already been issued.

Published in The Express Tribune, March  19^th,  2015.

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