Japan seeks abolition of tax on reserves, turnover
Pakistan outlines unfavourable conditions for textile exports
PHOTO: FILE
ISLAMABAD:
Japan has called for abolishing the tax on undistributed reserves as well as the turnover tax besides seeking a safe and secure environment for its companies aspiring to invest in Pakistan.
These suggestions were made by Tsuneo Kitamura, Parliamentary Vice Minister of Economy, Trade and Industry and a 57-member Japanese business delegation at the fifth Pakistan-Japan Government Business Joint Dialogue here on Tuesday.
Taxing companies looking to expand
The Pakistani side included Privatization Commission Chairman Mohammad Zubair, Commerce Secretary Muhammad Shahzad Arbab and representatives of different businesses. The Japanese side shared that tax issues were one of the challenges Japanese companies faced when they started business in Pakistan. They requested for doing away with the tax on undistributed reserves and the turnover tax, according to a document released by the Japanese embassy in Islamabad.
The Japanese also highlighted that safety and security was imperative for their companies working in Pakistan in order to encourage stable economic activities and push for new trade and investment partnerships.
Govt partially retreats from aggressive tax proposals
The Pakistani delegation pointed out that though Japan was a promising market for textile products, but the exporters were at a disadvantage because of the restricted market access compared to regional competitors such as India, Bangladesh and Asean member states.
These competitors were enjoying duty-free access to the Japanese market, either because of bilateral and regional trade arrangements or having the least developed country status. Pakistan enjoys the Generalised Scheme of Preferences (GSP) status and duties on its goods are on average 1.4% lower compared to developed countries, but the average tariff is 5.36% higher than that on India, Bangladesh and Asean nations.
Last year, Japan imported textile products amounting to $38 billion, in which Pakistan’s share was just $123 million, constituting less than 0.33%.
Published in The Express Tribune, November 11th, 2015.
Japan has called for abolishing the tax on undistributed reserves as well as the turnover tax besides seeking a safe and secure environment for its companies aspiring to invest in Pakistan.
These suggestions were made by Tsuneo Kitamura, Parliamentary Vice Minister of Economy, Trade and Industry and a 57-member Japanese business delegation at the fifth Pakistan-Japan Government Business Joint Dialogue here on Tuesday.
Taxing companies looking to expand
The Pakistani side included Privatization Commission Chairman Mohammad Zubair, Commerce Secretary Muhammad Shahzad Arbab and representatives of different businesses. The Japanese side shared that tax issues were one of the challenges Japanese companies faced when they started business in Pakistan. They requested for doing away with the tax on undistributed reserves and the turnover tax, according to a document released by the Japanese embassy in Islamabad.
The Japanese also highlighted that safety and security was imperative for their companies working in Pakistan in order to encourage stable economic activities and push for new trade and investment partnerships.
Govt partially retreats from aggressive tax proposals
The Pakistani delegation pointed out that though Japan was a promising market for textile products, but the exporters were at a disadvantage because of the restricted market access compared to regional competitors such as India, Bangladesh and Asean member states.
These competitors were enjoying duty-free access to the Japanese market, either because of bilateral and regional trade arrangements or having the least developed country status. Pakistan enjoys the Generalised Scheme of Preferences (GSP) status and duties on its goods are on average 1.4% lower compared to developed countries, but the average tariff is 5.36% higher than that on India, Bangladesh and Asean nations.
Last year, Japan imported textile products amounting to $38 billion, in which Pakistan’s share was just $123 million, constituting less than 0.33%.
Published in The Express Tribune, November 11th, 2015.