KARACHI, May 9: The Towel Manufacturers’ Association of Pakistan (TMA) has proposed single stage sales tax system for textile sector to resolve the refund issue.

While criticizing the present system of sales tax refund, which promotes corruption and loss of revenue to the national exchequer, TMA patron-in-chief S.M.A Rizvi has recommended that a single stage sales tax system be should be imposed on ginning factories only.

In a statement he further said it might be refunded on a percentage basis to the exporters as being done in the case of customs duty. The cotton crop should be completely documented for achieving any meaningful results. Mr Rizvi pointed out that in order to resolve the sales tax refund issue, export oriented recognized trade bodies be involved to help the sales tax department.

The banks should be made responsible for the production of the person who issues cross-cheques and receives payments through their bank accounts, he suggested.

He further said instead of promoting junior staff to a very high position the government should revamp the CBR by inducting new and qualified people. Mr Rizvi is of the view that without resolving sales tax problems there will be no new investment, and the VAT should be gradually imposed on selected items.