April 07, 2007	Saturday	Rabi-ul-Awwal 18, 1428

ISLAMABAD, April 6: The Central Board of Revenue (CBR) has turned down the proposal of the textile industry seeking exemption of income tax on export proceeds. “The income tax on profit is not exempted anywhere in the world and will not be done in Pakistan either,” CBR Chairman M Abdullah Yousuf stated this while rejecting the proposal of All Pakistan Textile Mills Association (Aptma).

The CBR chief was replying to questions at the National Assembly Standing Committee on Finance and Revenue here on Friday headed by its Chairman MNA Chaudry Anwar Ali Cheema.

Mr Yousuf reiterated that exports of goods were zero-rated and cited various schemes, measures of the government in this regard. “The government, as a matter of policy, has always ensured that various export facilitation regimes, ensuring zero-rating of exports, remain available to the exporters,” he added.

The $10 billion worth textile industry is reluctant to share some part of their income to the national kitty while constantly seeking taxpayer’s money in subsidies to protect their inefficiencies.

CBR statistics showed that 70 leading textile units had declared loss, which mentioned in the income tax returns filed in the income tax year 2005-06. Only seven textile units had shown more than Rs100 million profits during the year under review.

“This loss is contrary to the fact as the export of textile products are steadily on rise during the last few years, which indicates that the biggest industry of the country has meaningless contribution in the tax collection,” the CBR observed.

Briefing the standing committee, the CBR chairman said that the schemes that currently existed were offering wide-ranging choices to the exporters, which they can avail of depending upon the nature of their businesses and convenience.

These regimes target our main export areas like textile, leather goods, sports goods, surgical goods, carpets, footwear, engineering goods, metal products etc., in particular, and the rest in general, he added.

He said four extensive notifications of drawback of customs duty were presently in field, which cover 101 items of textiles, 55 items of leather/sports goods, 101 items of engineering/metal products and 314 miscellaneous items.

The chairman said that a number of regimes providing zero-rating on exports were available. Exporters, depending upon their working environment and need, can avail any of these schemes. “The CBR, in view of the importance of zero-rating for the purpose of exports, continues to review and improve these regimes for the facilitation of exporters”.

All Pakistan Exporters Association Chairman Shafqat Elahi gave a critical analysis of Textile Vision: 2005. He said, amongst major recommendations which had not been implemented so far included zero-rating of exports.

On the occasion, the standing committee asked all the stakeholders including the representatives of Aptma, PHMA and other organisations to sit with the CBR and SBP to evolve a consensus on all major issues. Their recommendations would be considered in next meeting of the committee to be held in two weeks time.

CSIBL VIOLATIONS: Meanwhile, the standing committee also asked the Securities and Exchange Commission of Pakistan (SECP) to submit a detailed report in two weeks on its action taken against the Crescent Standard Investment Bank Limited (CSIBL).

The SECP had suspended board of directors of CSIBL on August 31, 2006 on charges of violation of the legal requirements and serious financial irregularities. CSIBL is sponsored by the Crescent Group of Companies, which owns the bank’s majority shareholding of 51 per cent.

The committee asked the SECP Chairman Raziur Rehman to come up with a detail report latest by April 14 on the action taken against the CSIBL.

The committee members grilled the chairman over the delay in taking any action against the people who were responsible for the bankruptcy of the CSIBL.

PPP Parliamentarian MNA Naveed Qamar told Dawn that the SECP chairman had accepted before the committee in the last meeting that maximum shareholders belonged to the family of ERRA Chairman Altaf M. Saleem.

He said the government rather to take action against Mr Saleem had given him such an important post. He said that enough evidences were available but the government reluctant to take action against those responsible for this crisis.