KARACHI: Pakistan’s all exports associations on Tuesday criticized the federal government for its taxation plans and rejected the “Normal Tax Regime” (NTR) announced in the budget 2024-25 as “counterproductive” for the industries.
At a joint press conference, which held online simultaneously with exporters representing their respective trade associations ranging from textiles to fisheries and vegetables sectors unanimously declined to accept the controversial normal tax. Voicing deep apprehension, they said that the proposed shift of exporters from one percent turnover-based Final Tax Regime to the standard taxation of 29 percent of a taxable profit will ruin exports.
The rare joint presser took place through a video link concurrently in Karachi, Lahore, Faisalabad, Sialkot and Multan with Chief Coordinator and spokesman for the All Exports Associations of Pakistan, Muhammad Jawed Bilwani also rejecting the abolishment of “Final Tax Regime”. He said that the next federal budget has proposed to place the Normal Tax for the exports sectors and end the Final Tax, which the associations have rejected, as they are cautious to see the taxation plans as a trigger to pull down manufacturing growth. The move, he feared, will also bring unnecessarily the FBR into the affairs, which may open up “gates for corruption”. The present tax deduction mechanism is electronically working, which ensures no human interferences or interventions. “Presently, the one percent tax deduction under FTR is at source deducted electronically upon receipt of export proceeds, irrespective of profit or loss, without human intervention in a transparent manner,” Bilwani said.
The export associations lashed out at the federal finance minister and chairman FBR for leaving them out of the pre-budget discussions, questioning the government’s intentions as what holds it back from hearing the taxpaying exports sectors. They said that the government invited a few top industrialists for a budget consultation, adding that the government has acted like an undemocratic rule to exclude exporters and country’s business community. The exporters also warned the government of a disaster may ravage the already performing exports sectors with an initial setback of retrenchment if any “unwise” step in the budget was taken. With concerns, they said that further taxing the exporters is not a solution to revenues growth, advising the government to broaden the tax-to-GDP ratio through the FBR, which has though failed to meet its primary responsibility so far. They added that the government should enroll the non-taxpayers, instead. They said that the “unilateral and arbitrary” imposition of “harsh anti-export taxation” will wreak havoc on the exports, bringing manufacturing growth down with industries closures. Resultantly, they warned the unemployment will sweep the country and unleash disorder in the society. They said that the country life in ingrained in the exports growth, which can pull out the nation from the looming economic perils, alerting the government to the decline in revenues under various heads if the proposed budgetary changes in tax regime took place. Consequently, they said, the country will see a sharp fall in the foreign exchange earnings, besides a reduction in the overall tax collections from the exports sectors. Thus, they added, the country’s exports will succumb to the huge competition on the global markets as well.
They said that the government is left with only option to introduce industrial growth policies to help aggrandize the exports. They assured the government of a robust exports growth if plausible and helpful initiatives arrived. They demanded of the government to cancel its proposed move of scraping exports from the Final Tax Regime in the finance bill to help prevent further trade deficit.
President KCCI Iftikhar A. Sheikh, President FCCI Dr. Khurram Tariq, President SCCI Abdul Ghafoor Malik, President PAJCCI Junaid Makda have also supported the exports associations demands. They urged the government to step up solving the exporters’ issues, forthwith.
Exports associations included: The Value-Added Textile Exports, Apparel, Cloth, Denim, Towel, Bedwear, Gloves, Leather, Tannery, Carpet, Sports, Surgical, Rice, Fruits, Vegetables & Fisheries represented by Pakistan Hosiery Manufactures & Exporters Association (PHMA), Pakistan Readymade Garment Manufacturers & Exporters Association (PRGMEA), Towel Manufacturers & Exporter Association (TMA), Pakistan Cloth Merchants Association (PCMA), Pakistan Denim Manufacturers Association (PDMA), Pakistan Knitwear & Sweaters Manufacturers & Exporters Association (PAKSEA), Pakistan Cotton Fashion Apparel Manufacturers & Exporters Association (PCFA),Pakistan Bedwear Exporters Association (PBEA), Pakistan Textile Exporters Association (PTEA), All Pakistan Bedsheets & Upholstery Manufacturers Association (APBUMA), Pakistan Leather Garments Manufacturers & Exporters Association (PLGMEA), Pakistan Tanners Association (PTA), Pakistan Carpet Manufacturers & Exporters Association (PCMEA), Pakistan Sports Goods Manufacturers & Exporters Association (PSGMEA), Surgical Instruments Manufacturers Association of Pakistan (SIMAP), Pakistan Gloves Manufacturers & Exporters Associations (PGMEA), Rice Exporters Association of Pakistan (REAP), All Pakistan Fruits & Vegetables Exporters, Importers & Merchants Associations (PFVA), Pakistan Fisheries Exporters Association (PAKFEA), All Pakistan Meat Processors Association (APMEPA), Karachi Chamber of Commerce & Industry (KCCI), Sialkot Chamber of Commerce & Industry (SCCI), Faisalabad Chamber of Commerce & Industry (FCCI) and Pakistan-Afghanistan Joint Chamber of Commerce & Industry (PAJCCI) took part.
Export associations from Karachi were represented by Muhammad Jawed Bilwani, Chief Coordinator, Value-Added Textile Forum, Iftikhar A. Sheikh, President KCCI, Dr. Khurram Tariq, President FCCI, Abdul Ghafoor Malik, President SCCI, Junaid Makda, President PAJCCI, Abdul Jabbar Gajiani, Chairman PHMA SZ, Mian Farrukh Iqbal, Chairman NZ, Amanullah Khan, Sr. Vice Chairman PHMA NZ, Musharraf Khawaja, Vice Chairman PHMA NZ, Ijaz Khokhar, Ex-Chairman PRGMEA, Syed Aasim Shah, Chairman APBUMA, Khawaja Usman, Chairman PCFA, Rafiq Godil, Chairman PAKSEA, Khurram Mukhtar, Patron In-Chief PTEA, Waheed Ahmed, Patron In-Chief PVFA, Naeem Khokhar, Chairman PCMEA, Qasim Mehmood, Chairman PGMEA, Yousuf Hassan Bajwa, Chairman SIMAP, Muhammad Zafar Iqbal, Chairman PAKFEA, Abdul Hannan, Chairman APMEPA, Arshad Latif Butt, PSGMEA, Muhammad Owais, Vice Chairman PRGMEA, Khurshid Alam, Vice Chairman TMA, Amanullah Aftab, Chairman PLGMEA, Abdus Samad, Ex-Chairman PCMA, Shoaib Majeed, Ex-Chairman PDMEA, Muhammad Shafi, Sr. Vice Chairman PTA, Danish Javaid, Ex-Chairman PBEA, Rafiq Suleman, Ex-Chairman REAP and large number of prominent textile exporters participated.
Copyright Business Recorder, 2024
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