The Central Board of Revenue (CBR) has started an exercise to rationalise duty structure on imported raw material, textile processing machinery and spare parts on the recommendations of the Federal Textile Board (FTB). Official sources told Business Recorder on Wednesday that the tariff rationalisation exercise has been started to enhance exports benefiting the textile industry.
The step is necessary to increase investment in this sector where government policy of credit availability led to an investment of $4 billion in the form of new machinery for balancing, modernisation and expansion.
It is learnt that the CBR is preparing a summary for the economic co-ordination committee (ECC) of the cabinet recommending rationalisation of tariff for the textile industry. Sources said the CBR is particularly focusing on manmade fabrics to boost textile exports.
Officials said that spinning and weaving were quite mature in Pakistan, however, the value-added sector needs more attention.
Moreover, the manmade fiber segment has to grow in line with the global demand and the industry cannot solely depend on cotton.
In this connection, the CBR has started meetings with four major export associations including All Pakistan Textile Mills Association (Aptma), Pakistan Readymade Garments Manufacturer's Association (PRGMA), Pakistan Hosiery Manufacture's Association (PHMA) and Pakistan Towel Exporters Association (PTEA).
The CBR is discussing fiscal issues pertaining to textile sector with these associations. Special importance has been given to manmade fibers including blended fabrics, garments and made-ups.
Manmade fibers also include viscose staple fibre blended yarn, 100 percent acrylic staple fibre yarn, acrylic staple fibre blended yarn, polyester staple fibre yarn, polyester staple fibre blended yarn and many other types of manmade fibers.
Recently, textile minister Mushtaq Ali Cheema met CBR chairmen Abdullah Yusuf and member, sales tax, Shahid Ahmed to discuss 'special rules for delivery of goods and services (without payment of sales tax) rule 2005' with emphasis on removal of difficulties of the textile industry.
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