Garments industry for stopping audit notices
Garments industry for stopping audit notices


Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has asked the Federal Board of Revenue (FBR) to help strengthen the industry and exporters by timely releasing sales tax refunds, instead of sending them audit notices.

In a statement, the association pointed out that more than 51% of tax revenue was being collected from the manufacturing sector, though its share in gross domestic product (GDP) was just 13%.

On the other hand, it said, the agricultural sector, which constituted more than 26% of GDP, was not fulfilling its national obligation and was paying just 2% of income tax.

PRGMEA Central Chairman Mubashar Naseer Butt underscored the need for widening the tax base and bringing the agricultural sector to the tax net.

“The FBR, instead of facilitating the industry, creates problems for the manufacturers and exporters,” he said, adding that tax collectors had started sending audit notices to the exporters, though they were required to swiftly release tax refunds.

“On average, 10 audit notices are being served on almost every exporter, who is fed up with the long delay in refunds.”

“It’s the question of survival in the backdrop of an acute liquidity crunch and we need the government’s help to save the industry from bankruptcy,” appealed PRGMEA Vice Chairman Waseem Akhtar.

He called for ensuring ease of doing business, lowering cost of production, providing a solution to the liquidity crunch through early refund payments, drawing up a long-term and consistent energy tariff policy and relaxing the import policy for industrial raw material.

Airing concern over the withdrawal of competitive power tariff of Rs19.90 per unit, Akhtar pointed out that it led to a further decline in textile and overall national exports, which was ‘alarming’ and ‘unfortunate’.

Published in The Express Tribune, March 31st, 2023.

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