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Continuation of zero rating of STS urged

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KARACHI: Five Zero Rated Export Sectors (Value Added Textile – Sports Goods – Surgical – Leather – Carpet) appeal Prime Minister of Pakistan Imran Khan to intervene for continuation of Zero-Rating of Sales Tax Scheme in the national interest to uplift exports. Discontinuation of zero rated status will result in ruin and disaster of export oriented industries, flight of capital, mass unemployment and huge foreign exchange losses, says a Press release.
The Chairmen of Five Export Sector Associations in a joint Press Conference held at Karachi Press Club stated that the concerned high ups at Islamabad are not realizing the gravity of situation and sensitivity of the matter and are stubborn to implement the dictates of IMF. Pakistan is a sovereign country and the government should accord top priority to the national interest. Expressing deep concern, they stated that their genuine arguments and justification raised in various meetings and interactions with Government to continue zero rating of sales tax went deaf on the ears of all concerned. We have categorically refused to accept the government’s new tax regime to discontinue zero rating whereby exporters liquidity will stuck up like in the past as no successive governments have kept their promises and cleared the backlog of exporters refund claims worth billions of rupees in shape of Sales Tax, Withholding Tax etc and we shall not deviate from our principle demand to continue zero rating, they maintained.
Discontinuation will also lead to corruption in connivance with unscrupulous elements in FBR under the mode of flying invoices, over invoicing, frauds in refunds etc. Further, due to significant volumes of liquidity being stuck in the form of sales tax refunds, export growth will be severely affected and we will witness a decline in exports. More than 200 billion rupees of exporters in Refunds of Sales Tax, Customs Rebate, Withholding Tax, DLTL & DDT are already held up with Government. They also conveyed serious apprehension on proposed abolition of Final Tax Regime (FTR) for exporters.