LAHORE: All Pakistan Textile Mills Association (Aptma) has sought abolition of the Gas Infrastructure Development Cess (GIDC), appealing the government to bail the textile industry out.
Speaking at a press conference here on Friday, Aptma (Punjab) Senior Vice Chairman Seth Akbar Sheikh said the previous government introduced the GIDC through legislation, imposing Rs13 on using one mmBtu (million British thermal unit) gas by each mill falling in the category of formal or recognised industry. Later, it was gradually increased to Rs100 per mmBtu.
But this government, he said, has increased it to Rs150 per mmBtu, adding Rs1 million or so as the GIDC in the monthly bill. “We can’t pay such a large amount. The government should withdraw it immediately.”
He said the government has failed to achieve the objective of imposing the GIDC, which was to develop the gas infrastructure, including import of liquefied natural gas (LNG), bringing gas from Iran and Turkmenistan through pipelines, etc, in an attempt to overcome shortage of gas in the country.
“We are suffering these days, even more than during the PPP government’s tenure. Due to severe energy crisis, 100 spinning units that are prime users of electricity have already been closed and another 100 have been closed partly,” he mourned.
He said the textile industry, which was dealing with $14 billon export business and contributing a huge share in the foreign reserves ever year, is being charged the GIDC, while the cement industry, which is dealing with only $400 million exports a year, has been exempted from the cess.
The industry in Punjab, mainly textiles, was facing 10 to 12 hours of electricity and gas load-shedding, he said, adding that the situation was better in Sindh and Khyber Pakhtunkhwa.
Also speaking on the occasion, another Aptma office-bearer Shehzad Ali Khan said the government was ignoring the textile sector despite the fact that the industry was an export-oriented one.
Meanwhile, Islamabad’s business community has welcomed the government’s decision to reduce GIDC rates for commercial and cement sectors, bring it down from Rs300 per mmBtu to Rs100 on power, Rs150 on general industry and Rs200 on captive power plants.
However, it has been demanded that the government withdraw additional tax on cement, and consider withdrawing Section 40(b) of Sales Tax Act which authorises the officers of the Federal Board of revenue (FBR) to monitor production, sales of taxable goods and the stocks position at business premises without obtaining any warrants from magistrate.
During a meeting of the federal capital’s business community on Friday, Islamabad Chamber of Commerce and Industry (ICCI) President Shaban Khalid said, “Section 40(b) will lead to misuse of powers and create undue harassment in the business community.”
Published in Dawn, June 21st, 2014