Freezing gas, power tariffs urged

KARACHI: The value-added textile exporters have demanded the government to freeze gas and electricity tariff for export-oriented industries for at least two years, as frequent tariff hikes and surcharges impact the competitiveness of local industry in the international market.

In a presentation to Prime Minister Imran Khan, Jawed Bilwani of value-added textile export sector noted exporters were already facing uncertainty in negotiating and finalising new export orders due to continuous fluctuation in exchange rates. “Government should give a mechanism to exporters in this regard,” Bilwani said.

Exporters were of the view that electricity and gas tariffs have reached unprecedented heights and any further increase would push the local industry out of business. Because of high cost of doing business in Pakistan, a large number of industrial units have already shifted their operations to other countries.

Bilwani said Export Oriented Unit (EOU) facility should be improved and made SMEs friendly, while a new system should be introduced and implemented to facilitate exporters in the revised sales tax regime.

He said after the budgetary measures, the cumulative incidence of duty/tax on import of raw materials had reached 46 percent, up 139.5 percent from 19 percent earlier, as additional customs duty was doubled to 4.0 percent; imposition of 3 percent additional sales tax; increase in income tax rates at import stage to 5.5 percent from 1.0 percent earlier and imposition of 17 percent sales tax.