Pakistan Readymade Garments Manufacturers and Exporters Association warmly welcomes zero rated sales tax policy for country’s five export sectors

Karachi, June 15, 2016 (PPI-OT): Shaikh Mohammad Shafiq, central chairman, Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) In a statement said that PRGMEA have warmly welcomed the zero rated sales tax policy for country’s five export sectors i.e. value-added textile, carpet, surgical, sports goods and leather.

Despite prior budget announcement The Finance Minister, Senator Mohammad Ishaq Dar and Chairman FBR have not issue any notification for zero-rating of five export sectors. As the result exporters are experiencing technical difficulties getting zero rating exemption as the custom authorities are not cooperating with the exporters no S.R.O had been issued by Federal Board of Revenue (FBR) in this regard. And a large number of export consignments have been withheld by exporters. Urge the government to issue the same immediately.

As cut-throat competition with countries, like Vietnam, Bangladesh and China, is giving tough time to Pakistan’s exporters. He also said that low cost of labour in Bangladesh goes in favour of employers. While the minimum wage is around $68 in Bangladesh, in Pakistan it is $125 and rising. Additionally the lower utilities cost further benefits the manufacturer, he pointed out.

Our government gives 4% rebate on incremental basis while our competitors offer on the whole export, as Bangladesh. In this scenario that doesn’t have 10 % increment bereft of this incentives. There should be some incentive for all exporters so that they compete, and play their role in development of Pakistan.

According to the PRGMEA Chief now this is the need of the hour for the Pakistani government to develop a coherent plan that allows some sort of exemption / concession to the garment sector to arrest its decline, as Pakistan’s exports fell to $19.155bn in the 11-month period (July-May) from $21.859bn a year ago, reflecting a decline of 12.4pc. He said that policies are not being implemented in true spirit, that’s why required results are not being fetched.

For more information, contact:
Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA)
3rd Floor, Plot No. 57-C, 24th Commercial Street,
Phase II (Ext), DHA, Karachi, Pakistan
Tel: +92-21-35890651-2
Fax: +92-21-35890653
Email: info@prgmea.org
Website: www.prgmea.org