LAHORE: The Customs Collector Zulfiqar Younas has said that all refund claims of the Pakistan Tanners Association north zone members would be cleared on priority basis, admitting the fact that long delay in refund payment has been inflicting the industry.
Addressing the meeting of PTA North Zone, Customs Collector assured the leather exporters of early clearance of their all pending rebate claims.
The Collector pledged to provide all necessary facilities to the Lahore-based exporters and importers, besides removing hurdles to motivate them to do their business through Lahore Dry Port.
Zulfiqar Younas said that Pakistan Customs was introducing the business-friendly policies for encouraging the business community to struggle hard for promotion of exports.
PTA north zone chairman Azam Malik while addressing the meeting, stressed the government to act decisively and rescue the leather industry from financial crisis, as worst ever cash flow crunch has brought the second largest industry to the verge of disaster.
“The FBR is hampering the growth of one of the most productive sectors, generating employment of over one million people and earning foreign exchange of around $1 billion, by denying the exporters their right of refund,” he said. He added that government should take realistic view of the matter and release the long outstanding refunds at the earliest.
Azam Malik said despite the record revenue collection, non-payment of exporter’s outstanding refunds is unjustified. “The government at many times gave firm assurances for payment of refunds but failed to keep its promises. The FBR, under the law, is bound to release refunds within 45 days but there are delayed refunds for the years,” he said.
PTA north zone chairman said that leather exporters, the high value-added industry, are badly deprived of liquidity while the government is showing the stuck-up refund amounts in its revenue account which is not a fair practice.
Addressing the meeting, PTA Chairman Anjum Zafar observed that Pakistani leather exporters have crumbled because of blockage of sales tax and duty drawback refunds for the past several years.
“We want no benefits but we do want our money refunded. Presently, sales tax and duty draw backs refunds amounting to over Rs 250 million of the Punjab leather industry are stuck up, thus creating a liquidity crunch.”
Exports are stagnant and export-oriented industry in a dire need of resources, delay in payment of refund claims adding to their miseries, he added. Delay in release of huge funds has triggered serious liquidity crunch for the exporters and manufacturers that might lead to closure of several industrial units which will have very damaging consequences, he warned.
Government should recommend policy and take steps to reduce cost of doing business by 8-10% for finished leather exports, he demanded. He suggested that refund of all taxes, levies, duties, surcharges etc. should be refunded to exporters. If through DLTL, then refund must be 100% through banks on realization of proceeds.
He demanded that FBR and Customs Department should be taken on board to implement original rate of duty drawback as per recommendation of IOCO.
Moreover, matter may be taken up strongly with Minister of Finance and FBR to allow import of raw material at zero-rate instead of present 3%.
He called for taking up matter of depleting livestock with concerned departments and to take steps for revival of livestock and make policy decision.
At the end of the meeting, the Pakistan Tanners Association and Pakistan Customs agreed to evolve a comprehensive mechanism to release the refunds of the leather exporters, as non-payment of refunds has resulted in falling exports.
