Karachi, May 29, 2019: Engr. Daroo Khan Achakzai, President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), S. M. Muneer Former President FPCCI and Iftikhar Ali Malik, Former President FPCCI & Sr. Vice President SAARC-CCI show their serious concern over the speculation of withdrawal of Zero Rated Facility for the five Key exports sector in the forthcoming budget.
They said that the withdrawal of zero-rating facility of key five sectors i.e. value added textile, leather, carpet, surgical instruments and sports goods will decline further exports of Pakistan which is confronted with many challenges. These five sectors contribute 70 percent in exports of Pakistan and contribute significantly to earning foreign exchange and providing employment to the skilled and unskilled labor force.
They further stated that the refunds claims of exporters amounting to Rs. 300 billion is already pending with FBR creating liquidity crunch and hurdles to new investment. Due to uncertainty in the economic environment, the investors are reluctant to make an investment in Pakistan. Moreover, the devaluation of Pak. Rupees more than 30 percent in the last one year does not impact positively on the enhancement of exports.
They added that the withdrawal of this facility will increase the cost of doing business due to 17 percent sales tax and high utility cost, as Pakistan’s exports are already facing tough competition in the international market due to enormous facilities given by the regional countries to their exporters.
They further stated that the government should find new avenues for enhancement of its revenue instead of damaging the exports sector which is already on a decline. They further suggested that the government should facilitate the industrialization in Pakistan particularly the agro-based and value-added industries for the enhancement of exports.