Exporters are seriously worried over the constant delay in payment of sales tax refunds under the newly introduced system, titled, ‘Faster’ of the Federal Board of Revenue (FBR). According to the FBR’s data, out of total refund claims of Rs24.281 billion filed under the Faster system, the FBR has paid Rs16.480 billion sales tax refund to the textile sector up to January 15, 2020.
Shabir Ahmed, Chairperson, Pakistan Bedwear Exporters Association pointed out that small and medium exports are going through serious crunch as a result of slow dispensation of refunds under the Faster system. The prime minister has promised to facilitate the small and medium export industries, but the crisis is worsening.
Despite the FBR’s exaggerated claim that it would now pay sales tax refunds through the newly installed system to exporters of five sectors within 72 hours of submission of refund claims, sales tax refunds had not been paid yet. Billions of exporter’s money has been in control of FBR as they are going through extremely bad financial situation and are unable to procure materials/inputs for manufacturing goods meant for exports. Ahmed further said, “I have to rush to Europe due to delay in shipment of export orders and will meet foreign buyers to convince them about the situation in Pakistan. In the absence of working capital and blockage of refunds, we are unable to meet export orders.”
He sadly communicated that the government was comparing refunds payment data of July-January (2019-2020) to the same period of 2018-2019, when five leading export sectors were sales tax zero-rated.