Exporters have complained of 'inordinate' delays in sales tax refund by the tax office, saying that the Textile Ministry failed to honour its pledge to clear the refund claims of textile sector. Exporters demanded of the government to abolish the two percent sales tax regime for textile sector with a view to improve its finances for a better export prospects. "All the deferred claims of refunds should be cleared immediately," Chairman Pakistan Apparel Forum, Javed Bilwani demanded.
He suggested the government to reintroduce 'no-payment, no refund system' for textile sector and scrap the existing two percent sales tax regime to end the long-running financial and taxation problems of exporters. "We [textile exporters] have been requesting time and again that when refund claims cannot be paid in time, this system of taking payment and then refunding must be scrapped once and for all and the system of "NO PAYMENT NO REFUND" should be reintroduced and two percent sales tax be done away with," he said.
He also regretted that the refund processing orders have not yet been issued to refund the tax claims of exporters despite the FBR has claimed to have done so till June 30, 2014. He said that the exporters were facing financial problems in the wake of non-refunds of their taxes.
"It is a fact that the Finance Minister had assured that all Sales Tax Refund Claims up to September 30, 2014 would be cleared," Bilwani said, adding that the exporters should be paid their tax refunds within seven days after the issuance of refund processing orders. Previously, he said, there was no system of refund processing orders as the exporters would receive their refunds directly without any such orders. He said that he was of the firm opinion that Zero Rating on Utilities for all new exporters should be speedily examined and implemented.
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