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Saturday June 22, 2024

Upcoming 2024-25 budget: Hosiery manufacturers want budget focus on boosting exports

Rs40 billion under the textile policy for duty drawback taxes, technology upgradation funds and markup support remain unpaid

By Our Correspondent
May 20, 2024
In this image, a worker operates a machine in a factory. — APP/File
In this image, a worker operates a machine in a factory. — APP/File

FAISALABAD: Patron-in-Chief of the Pakistan Hosiery Manufacturers and Exporters Association Chaudhry Salamat Ali has emphasized the need for the upcoming 2024-25 budget to focus on boosting exports to help the country overcome its economic crisis.

He stressed the importance of reinstating the “zero-rating” regime for the export industry to alleviate the financial difficulties of exporters and ensure they do not face a shortage of working capital. He highlighted that a total of Rs145 billion in sales tax, Rs25 billion in duty drawbacks, and Rs40 billion in income tax and income tax credits have been outstanding for several years.

Additionally, Rs40 billion under the textile policy for duty drawback taxes, technology upgradation funds and markup support remain unpaid. He called for at least Rs250 billion to be allocated in the new budget to address these payments.

Salamat Ali also pointed out the need to operationalize the “Faster” system, designed under Rule 39F of the Sales Tax Act 2006, to ensure sales tax refunds are paid within 72 hours, thereby eliminating unnecessary delays.

He suggested that the budget should provide a clear roadmap for the payment of income tax, income tax credit and customs rebate refunds to exporters. He advocated for the continuation of the final tax regime to maintain the benefits provided to exporters. Furthermore, he urged commercial banks to introduce new and improved financing schemes for exporters to resolve the issue of capital shortages faced by textile exporters. He also highlighted the need to rationalize energy tariffs based on the actual cost of services, ensuring that the burden of subsidies provided to other sectors does not fall on textile exporters.