KARACHI, Jan 27: The Central Board of Revenue (CBR) has rolled out a simplified automated refund procedure for processing refunds of sales tax in five zero-rated sectors, including textiles, sports and surgical goods, carpets and leather goods.

This was stated by the Collector, Sales Tax and Federal Excise (Enforcement), Shafqat Mehmud, in a meeting with the members of Pakistan Hosiery Manufacturers Association (PHMA), led by its chairman, Mr Saleem Parekh.

The PHMA chairman complained about huge number of unpaid sales tax refund claims pertaining to post-zero rated regime with the sales tax department.

The collector informed the PHMA members that all exporters of these five sectors would not have to submit huge data which was previously required for claiming sales tax refunds.

He further said stated that the new simplified procedure would only be retaining cases for risk analysis factors.

Mr Mehmud said the manufacturers are now not required to submit details of exports and they will have to submit only data pertaining to their taxable inputs.

The new risk-based refund procedure, besides being efficient, has also done away with heavy documentation for refund purpose by the manufacturers.

Meanwhile, the towel manufacturers have complained that over Rs205 million sales tax refund claims are pending for long with the sales tax department causing liquidity problem for exporters.

In a statement, chairman, Towel Manufacturers’ Association of Pakistan (TMA), M Muzzammil Husain, said the end of quota regime has led to cut-throat competition in the textile sector.

The situation requires that the government plays the role of a facilitator so that exporters could compete in the world market and maintain their market share.

Presently, he said exporters are confronted with liquidity problem owing to non-payment of sales tax refunds.