ISLAMABAD: Textile exporters met Finance Minister Miftah Ismail on Tuesday and informed him about the challenges they are facing related to income tax, sales tax refunds, deferred payment claims and exchange rates, and asked the government to address these issues, a leading industrialist told Dawn.
They complained that the tax machinery had withheld exporters’ refunds to show a rise in the overall revenue collection and there were delays in the availability of subsidised loans on already approved projects.
A delegation of the Pakistan Textile Exporters Association (PTEA), led by its chairman Shaiq Jawed, met Mr Ismail. The association’s patron-in-chief, Khurram Mukhtar, told Dawn after the meeting the delegation apprised the finance minister about three major issues: uninterrupted supply of energy to the textile sector round the year, release of refunds and a road map for clearing provincial sales tax refunds.
He said the minister was requested to set up a separate desk to process different refund claims with a deadline. The textile sector’s pending refunds stood at Rs35 billion on account of sales tax and Rs30bn in income tax. The tax credit amount of the textile sector is around Rs20bn.
PTEA delegation meets finance minister, informs him about issues facing the industry
Punjab and Sindh also owe Rs15bn as provincial sales tax refunds to exporters. The provincial refunds have been pending since 2013.
The minister was informed that loans under Temporary Economic Refinance Facility (TERF) and Long-Term Financing Facility (LTTF) schemes had already been approved by commercial banks but were not being granted at the moment. “This is putting all new investment at risk,” the minister was informed.
Mr Mukhtar said the State Bank governor had assured to look into the demands and would honour the past commitments.
The pending Duty Drawback of Taxes (DDT) refunds stood at Rs30bn, while another refund of Rs5bn under the head of technology upgradation fund (TUF) and another Rs0.5bn under the social contribution are also pending. “We have requested the finance minister for early release of these funds to address the liquidity crunch faced by the industry,” he said.
An official announcement of the finance ministry said Mr Ismail presided over the meeting with the PTEA delegation at the finance division.
The minister stressed that the present government was providing a conducive and friendly environment to the business community and assured the delegation that concrete steps were being taken to build up their confidence.
He directed the relevant authorities to take the required steps for resolving the industry’s concerns.
Published in Dawn, July 27th, 2022
