At a joint press conference, members of the Pakistan Hosiery Manufacturers and Exports Association (PHMA) urged federal government to restore zero-rating, continue duty drawback of taxes (DDT) and Technology Up-gradation Fund (TUF) scheme, and to lower final tax and withholding tax in Budget 2021-22. The members urged the government to reduce withholding tax rate to 0.5 per cent, suspend Export Development Fund (EDF) surcharge, and reduce and fix tariffs of electricity in the forthcoming budget.

The conference was attended by Zubair Motiwala, Chairman, Council of All Pakistan Textile Mills Associations; Jawed Bilwani, Chairman, Pakistan Apparel Forum; Tariq Munir, Chairman, PHMA and other leaders of different associations. Motiwala said they have been demanding restoration of zero rating on GST, “No Payment No Refund Regime” through revival of SRO 1125 in letter and spirit. The demand was made because SME exports have decreased by 30 percent as compared to last year due to imposition of 17 percent GST, which blocked precious liquidity.

With the introduction of TUF scheme in 2009, 30 per cent capacity of textile sector has been enhanced. Therefore, it is imperative to reinstate TUF scheme for the next five years, the speakers said. They added that 0.25 percent EDF surcharge was deducted from export proceeds of the exporters for export development since 1992. Collection of EDF surcharge was approximately Rs9 billion annually. Presently, the government has Rs58 billion in its kitty on account of EDF. Hence, they want the government to suspend collection of surcharge till the Rs 58 billion of EDF was exhausted.

They also demanded a one percent to 0.5 percent reduction in withholding tax for exporters as this would also help the exporters in using the cash liquidity for enhancement of exports.