FAISALABAD, July 9: The chairman, All Pakistan Cloth Exporters Association (APCEA), Mian Muhammad Latif, has warned the government that exports of textile would collapse if huge backlog of sales tax refund claims of exporters were not cleared.

Talking to newsmen here on Tuesday, APCEA chief said that millions of rupees of exporters were blocked in sales tax refund, and sales tax department was disposing the refund claims at snail’s pace. Backlog of refund claims from 4 to 6 months has piled up with the sales tax department and in some cases refund claims of more than one year old are still pending, he said.

He said that consequently the exporter’s total investment has been held up with the department at 15 per cent per month compared to slow payment from the sales tax department.

Mian Latif pointed out that although gold category was being paid refund to some extent, the amount being paid was very meagre as compared to the tax deposited with the government by the exporters.

He said that the situation was complicated by the political turmoil and uncertainties following the September 11 incident and American attack on Afghanistan and stand-off on Indo-Pak border.

The government had assured the exporters that situation would normalise after June 30 but the pace of issuing refund is still very slow and exporters find it difficult to meet their fresh export commitments, he said, adding that discontinuation of export finance facility on grey cloth has further added to exporters problems.