APTMA has rejected the textile package of Rs 180 billion saying that it will affect the growth rate of exports by decreasing it up to 15%. The extended textile package showed only an allocation of a sum of 4 billion and increased income tax and sales tax rates.
According to Chairman APTMA, Mr Aamir Fayyaz Sheikh, Prime minister Mr Nawaz Sharif allocated Rs 180 billion package to the textile sector to support its exports by reducing duties on cotton import and giving rebates on export. But, only after 4 months the finance ministry withdrew the package and increased the taxes and duties on the import of cotton for the sake of generating Rs 10 billion revenues.
The PM’s package envisaged Rs 7.3 billion per month rebate on export proceeds, which is expected to remain unfunded due to lack of budgetary allocations.
Mr Aamir Fayyaz, Chairman APTMA said,” The budget is a sheer disappointment for the textile sector, as the government has allocated only Rs4 billion against a total textile package of Rs180 billion. The finance minister should honor the prime minister’s word and make Rs180 billion allocations in the budget before it is passed by the National Assembly”. He further added that the government needs to release pending refunds and that internationally the garment industry has become uncompetitive due to high cost of doing business”.
The allocation for the textile package is likely to further widen the trust deficit between the business community and the government. The industrialists have already expressed their displeasure over the extension of super tax into a third year. APTMA Chairman claimed that the Federal Board of Revenue (FBR) has also blocked Rs 100 billion sales tax refunds to inflate its revenues. The sector also sought a cut in electricity tariffs.