Pakistan may impose a cess on imports and exports of textile products. The aim is to generate funds for the development and promotion of textile sector. After the imposition of the new development cess, the textile value chain will be exempt from the export development surcharge, the cotton cess, textile cess and the cotton standardization fee.

The proposed cess is aimed at helping the textile industry in Pakistan achieve sustainable growth, employment generation, increased productivity and value addition through the textile chain.

The cess will be levied and collected on imports and exports of all textile products. The rate of cess on imports and exports of textile products will be 0.2 per cent of the value of imports. In case of partial or short realization of export proceeds, the cess would be collected by authorized dealers at 0.2 per cent of the full FOB value of the goods shipped.

However, bed wear exporters will not support the proposed legislation. They say core issues that the industry is grappling with need to be addressed and that if the cess comes into effect the industry would end up with more bureaucracy, creating more problems for the industry. They say they are already faced with a liquidity crisis and loss of competitiveness due to expensive utilities, high cost of doing business, blocked refunds etc.