Hosiery manufacturers demand fast release of sales tax refunds

Hosiery manufacturers demand fast release of sales tax refunds

Hosiery manufacturers and exporters have urged the Federal Board of Revenue (FBR) to accelerate the pace of sale tax refund release.

The Pakistan Hosiery Manufacturers and Exporters Association (PHMA) urged the Federal Board of Revenue (FBR) to expedite the release of sales tax refunds for the value-added knitwear industry.

READ MORE: PBC raises concerns over proposed requirement of beneficial owner records

This would help alleviate the industry’s cash flow problems, particularly with regards to paying workers’ wages during Eid.

Naseer Butt, the PHMA North Zone Chairman, stated that the export-oriented industry is facing significant financial difficulties, losing billions of rupees due to liquidity being tied up from the delay in releasing sales tax refunds.

Butt also noted that the government had halted the release of all sales tax refund claims, causing inconvenience and delays for exporters.

READ MORE: Property prices register 15% decline owing to heavy taxes, political uncertainty

He added that the export industry was already struggling due to gas shortages, power outages, and restrictions on opening Letter of Credits (LCs) for industrial raw materials, along with the discontinuation of DLTL and Regionally Competitive Energy Tariffs.

READ MORE: Bank borrowing by private sector plunges by 77% in Pakistan

Despite repeated calls to save the industry, which is facing one of its toughest periods in history, the government has not taken action. Butt also criticized the new parameters introduced in the STGO (Sales Tax General Order), which could lead to further delays and corruption.

He urged the FBR Chairman to fix the technical glitches in the FASTER system, which has caused delays in processing sales tax refunds, resulting in a liquidity crunch and damaging exports.

READ MORE: Pakistani exchange companies demand regulations for cryptocurrencies