FAISALABAD: The Pakistan Textile Exporters Association (PTEA) has urged the government to address the challenges in export sector as issues, including stuck up liquidity, high priced energy inputs and imposition of duties and taxes on inputs/raw materials, are adversely impacting production.In a statement here, PTEA chairman Khurram Mukhtar said that global markets were wide open and Pakistan could achieve significant increase in exports by encouraging investment in addition to enhancing competitiveness. He said that extreme cash flow crunch had squeezed the financial streams and unavailability of sustainable energy package had increased the production cost while levy of anti-dumping duty on basic raw materials and withdrawal of exemption of sales tax and FED on locally procured input goods had disrupted the supply chain and slowed down the export pace.Elaborating the situation, the PTEA chairman said that tax refunds around Rs170 billion belonging to textile exporters had already halted in refund regime, whereas huge refund bill for July had also been added. Furthermore, refunds against provincial sales tax had been pending since 2013, creating extreme financial stress and the exporters were unable to accelerate industrial growth and make significant increase in exports, he added.He said that mechanism for promissory notes issued against sales tax refunds through the Central Depository Committee (CDC) had not yet been defined, whereas the income tax bond legislation had been done, but the refund cases were not being processed. Discounting mechanism should be defined and rate of profit should be brought in line with the market rate, he demanded.In order to cut down the production cost of export goods and secure the competitive edge with regional rivals, a sustainable energy package was granted to zero rated sectors in October 2018. Unfortunately, no subsidy had been provided on gas supply since March 2019 and the exporters were being charged on normal tariffs, he said, adding that similarly electricity bills had also been raised contrary to the Prime Minister’s directions.Objecting the changes made to the Finance bill 2019, he said that under the new tax regime, manufacturers making domestic supplies would get input adjustment in the same month whereas export oriented units (EOU) would get input adjustment after 175 days. This would further add the financial burden on the exports, he added.The PTEA chairman said that the EOU shall be exempted from sales tax on energy. Opposing the charging of income tax in electricity bills, he said that the exporters fell under FTR regime and were liable to final tax @1% which was deducted at the realisation stage of exports, therefore, there was no rationale for charging further income tax in the electricity bills. Highlighting another major issue of imposition of duties and taxes on inputs/raw materials, Khurram Mukhtar said that exemption of sales tax and FED on buying of locally procured input goods by the exporters operating under export oriented units rules had also been withdrawn. Terming the move as an anti-export, he said that in the current scenario, wherein 17pc sales tax had been imposed on all goods across the board, such concessions were the only ray of light in the cut throat competition being faced by the country’s exporters.He said that import of basic raw materials (yarn and hydrogen per oxide) had also been subjected to anti-dumping duty, which was entirely against the myth of manufacturing bond scheme and had increased the production cost of export items. PTEA vice chairman Muhammad Idrees pointed out that industrial undertakings investing in purchase of plant and machinery for extension, expansion, balancing, modernising and replacement were allowed tax credit equal to 10pc of the purchase price of machinery till tax year 2021. This tax credit had been reduced from 10pc to 5pc on the purchase value of machinery in the Finance Bill 2019, he said, adding that this act had discouraged the new investment in the industrial sector.He said that it was the right time to facilitate the export sector because only it had the ability to put the country’s economy on track and steer the country out of economic crisis.DIES IN ROAD ACCIDENT: A motorcyclist died in a road accident near Thikri Wala on Faisalabad-Jhang Road on Monday.Mudassar Ahmad was traveling on a motorcycle when another speeding motorcyclist Hassan Saleem hit him, leaving him dead on the spot. Hassan also sustained critical injuries and was removed to hospital.NURSE DIES AS CAR OVERTURNS: A senior nurse of Allied Hospital died in a road accident last night.Bushra Perveen of Batala Colony, Faisalabad her husband Safdar Ali and their daughter Zuhra Batool and a relative Ahsan were coming back to Faisalabad from Islamabad on Motorway in a car when they reached near Kot Mooman one of its tyres burst and it overturned.As a result, Bushra died on the spot and her husband, daughter and Ahsan sustained critical injuries. The injured were shifted to Allied Hospital.
from The News International - National https://ift.tt/2U3f7ui
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