KARACHI: The National Assembly Standing Committee on Textile Industry on Wednesday supported the value-added textile sector’s demand for declaring all five export-oriented sectors as zero rated from sales tax.

The committee, led by MNA Khawaja Ghulam Rasool Koreja, met with the value-added textile sector’s representatives at the PHMA House and showed full support to their demands.

The committee agreed with declaring exports as zero rated and following the ‘no payment, no refund’ system which was practiced up to March 2013.

The meeting observed that this will reduce the work load of the Federal Board of Revenue and also spare the export sector from wasting time in getting refunds.

The standing committee also agreed that power and gas tariffs should be at par with regional competitors and the textile sector be declared separately in the tariff structure.

Pakistan Apparel Forum Chairman Muhammad Jawed Bilwani said that during budget meetings, the industry had warned the government that vital exports will plunge by around 20 per cent if sales tax on exports was not withdrawn and cost of doing business was not brought at par with regional competitors.

However, there was no response from the government and the exports declined substantially despite the GSP+ scheme.

The committee also agreed that priority should be given to export-oriented industry in uninterrupted supply of all utilities.

Mr Koreja said the FBR should ensure immediate payment towards outstanding claims of sales tax, drawback and local taxes of the export sector. He further suggested that customs rebate should be refunded along with export proceeds realisation.

The committee members also supported the idea that the government should provide free of cost cotton seed to growers and purchase cotton from growers at the world price.

Published in Dawn, January 28th, 2016