FAISALABAD, Feb 10: Textile exporters have welcomed the new zero rating sales tax scheme with no sales tax payment, no extra documentation and least involvement of the tax authorities.

Talking to newsmen here on Thursday, the chairman, Pakistan Textile Exporters Association (TEA) said that the scheme introduced by the government under the title of special procedure and services without payment sales tax would facilitate the exporters 'both in financial and administrative terms'.

Congratulating the chairman CBR, Abdullah Yousaf and Member Sales Tax, Shahid Ali for evolving the new scheme and textile Minister, Mushtaq Ali Cheema for his practical involvement, PTEA Chief said that proposed scheme was certainly unprecedented, in that it covers immunity from tax on invisible value additions made by auxiliary manufacturing i.e. vendors and other allied sectors. He said that the new scheme does not involve the tax authorities for the determination of entitlement for use of the facility.

Furthermore it entails no extra documentation and promotes participatory representation with the help of exporters Associations. Introduction of the proposed scheme will accrue multiple benefits to the genuine large size manufacturers cum exporters, he said.

Elaborating, he said that industrial exporters would be entitled to buy or import their inputs free of sales tax. Regarding non-composite units all allied processes necessary for the manufacture and finishing of textile exports will also not attract any tax liability, he explained. "Zero rating will be eventually availed of by the end suppliers of the vendors thereby distributing the tax relief to the support manufacturing/supplying regime," he stated.

Mr Jawed was hopeful that the scheme would prove another significant pro-investment and pro-export measure of the government, certain minor irritants in the scheme notwithstanding.

"CBR authorities has informed that initially 200 large size manufacturer cum exporters have been selected for the new scheme. Over 75 percent of textile related sales tax refunds go to these industrial exporters. The implementation of the proposed scheme is likely to reduce the GST refund work to a substantial extent besides seeking the government from embarrassing complaints of delay and malpractice," PTEA Chairman concluded.