KARACHI: Business community from leather and textile industry has shown discontent over the possible increase in the rate of sales tax and has said that the cost of doing business in Pakistan is already high while it will go up further to the detriment of Pakistani exporters.
There have been indications that the government is considering to increase sales tax rate on textile and leather industries from 2 per cent to 5 per cent in the first phase and to 17 per cent in next three years.
Textile exporters have complained that they are not getting a level playing field and may fail to get desired benefits of GSP Plus status. They emphasised that the prices of utility should be reduced at least for export industries, and should be capped for a period of at least two years, so that the manufacturers and exporters could quote the price to the customers, which should be valid for time period of minimum one year.
Pakistan Tanners’ Association Chairman Sheikh Saqib Saeed Masood has said that leather industry, the second biggest export oriented industry of Pakistan, is already struggling to survive in lack of basic facilities as persistently demanded from the government for providing level playing field to the industry. He strongly opposed the proposal for increase of sales tax up to 17% under the prevailing business circumstances within the country, which he said, would definitely bring negative repercussions.
Businessmen have urged the Prime Minister of Pakistan, Nawaz Sharif, Commerce Minister Khurram Dastgir and Chairman FBR Tariq Bajwa to take immediate notice and early announcement for the withdrawal of proposed increase of sales tax up to 17 per cent in the supreme interest of leather and textile industries and end further financial suffering of the industry as well.