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Govt urged to abolish 2% GST from zero-rated sectors

Govt urged to abolish 2% GST from zero-rated sectors

KARACHI: Council of All Pakistan Textile Associations (Capta) Chairman Zubair Motiwala has urged the federal government to abolish 2% GST from the zero-rated sectors to ease their financial positions.

He, leading the scores of representatives from different value-added textile associations, held a meeting with Federal Secretary Commerce Qasim M Niaz at PHMA House to discuss the key obstacles to the sector’s growth and to seek an immediate end to their long-running problems.

Capta Chairman Zubair Motiwala pointed out that the exporters were facing severe financial problems by double taxations i.e. 2 per cent GST by the federal government of and the provincial government’s 16pc on services.

He blamed the FBR for not helping textile sector get rid of ‘draconian’ excise laws and ambiguous taxation methodology. He stated that four excise laws were hitting hard the entire sector, adding that the FBR ‘deceptively’ made them part of sales tax, forcing the exporters to pay the taxes anyhow.

Motiwala said, “The GST laws on selling of products to unregistered companies are still dubious and creating troubles for exporters.” He claimed without bribe no tax refund was possible and these laws and regulations were against the growth of entire textile sector.

The Capta chairman explained that the utility supplies with high tariffs had destroyed the textile sector as it had restricted export at $7 billion annually. He said, “With raw material like cotton or yarn, the annual textile exports stand between $11 billion to $13 billion.”

He said the government’s utility tariff plans left no choice for the consumers – either to pay bills for power thieves or just indulge in the theft. He asked the government to act against power thieves to end power shortage. He lamented that the gas was made pricey by 17 per cent and power by Rs 4 per unit and the Ogra had been bypassed to set prices for key utilities.

Federal Secretary Commerce Qasim M Niaz, answering a query, said since assuming charge of the ministry, he was meeting private sector representatives to address problems the industry. He said the country’s law and order situation was the main issue for the government to deal with. The commerce secretary said he would go for short and medium term goals to achieve the increasing challenges, faced by the export industry.