Exporters’ Refunds: Govt Urged To Devise Effective Automated Refund Mechanism
FAISALABAD– The Pakistan Textile Exporters Association (PTEA) has stressed the government to devise an effective and efficient automated refund mechanism for speedy reimbursement of exporters’ refund claims.
Further delay would block exporters’ working capital of more than Rs500 billion which will hamper the export growth.
In a statement here on Friday, Chairman PTEA Khurram Mukhtar, referring the pre-budget negotiations with the Government economic team, said that exporters’ were assured that an efficient automated refund system will be implemented after budget 2019-20 to ensure expeditious payment of exporters’ refunds.
Implementation of such system would ease off the financial stress of textile exporters as major portion of their working capital had already been blocked in refund regime and they are unable to accelerate industrial growth and make significant increase in exports.
Giving details, he revealed that tax refunds around Rs. 200 billion belonging to textile exporters are still halted in refund regime. The release of stuck up liquidity will not only boost export activities but will also bolster the entire supply chain and allied sectors.
Highlighting the reduction in tax credit facility, he said that industrial undertakings investing in purchase of plant & machinery for extension, expansion, balancing, modernizing & replacement were allowed tax credit equal to 10 pc of the purchase price of machinery till tax year 2021.
This tax credit has been reduced from 10% to 5% of the purchase value of machinery in budget 2019-21. This act will discourage the new investment in industrial sector.
He urged to continue the tax credit facility till tax year 2021 with 10pc tax credit.
He voiced the hope that expeditious disbursement of refund claims and continuation of tax credit facility @10% would swell the exports of the country and also create more jobs in line with the Government’s vision, he said.
Appreciating Government’s key initiatives to provide an enabling environment to the textile export industry, PTEA Vice Chairman Muhammad Idrees expressed that these measures have restored exporters’ confidence and textile exports have increased; whereas primary growth driver is the value-added textile sector.
Giving statistics, he said that in July-April period, Knitwear exports went up by 15.81pc in quantity and 8.76pc in value, bed wear edged up by 10.11pc in quantity and 2.40pc in value, Readymade Garments exports increased by 29.21pc in quantity and 3.21pc in value and Made-ups increased by 1.15%.
This is the right time to strike the textile industry as Pakistan is all set to accelerate its economic growth, he said. Pakistan can become an economic giant by utilizing its trade and investment potential.
Only export sector has the ability to put country’s economy on track and steer Pakistan towards economic prosperity. It is the right time to facilitate the export sectors as we direly need to stabilize the economy, he said.
Textile exporters stand ready to implement the Premier’s vision of economic prosperity through enhanced exports as textile value chain has envisioned to invest US$ 2 billion in next two years to generate 200,000 new jobs and achieve sizable growth.
He urged the Government to devise an efficient and effective automated refund mechanism for payment of exporters’ refunds.— PRESS RELEASE