Textile manufacturers in Pakistan want the zero-rated tax facility to continue. They also want pending tax refund claims to be cleared. Pakistan’s exports have fallen despite the GSP Plus status the European Union awarded the country in 2013 that allows exports at sharply reduced or zero duty. Textile exports have a 57 per cent share in Pakistan’s total exports.

In Budget 2017-18, export refinance facility was maintained at three per cent, export-oriented sectors continued to remain zero-rated and the duty-free regime for machinery imports stood unchanged. A five per cent regulatory duty was, however, imposed on the import of polyester filament yarn.

Now, textile exporters expect more incentives in the upcoming budget for 2018-19 that could help boost their earnings. Industry has also called for reintroducing the duty drawback scheme and removing or at least curtailing duty on the import of synthetic yarn and polyester staple fiber. They are seeking the removal of Gas Infrastructure Development Cess as well which will reduce the cost of production and improve competitiveness.

Meanwhile, the textile industry wants tax on cotton imports scrapped. Textile manufacturers are attracted by the long fiber of imported cotton compared to the cotton produced in Pakistan.