LAHORE: The Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) on Wednesday opposed any move to impose 18 percent sales tax on exporters under the Export Facilitation Scheme (EFS) and warned that such regressive measures will paralyze the garment export sector, stifle cash flow, and derail Pakistan’s opportunity to capture a significant share of the global apparel market.
Reacting to the proposals suggesting that the government is planning to slap a hefty tax burden on exporters, the PRGMEA voiced serious concern over what it described as a deliberate campaign by vested interests in the domestic textile sector to weaken the growth potential of the country’s most dynamic and value-added industry — the ready-made garments (RMG) sector. The association called for the immediate withdrawal of any such proposal and demanded that the EFS remain untouched and fully functional to support exporters with timely and hassle-free access to tax-free inputs.
Dr Ayyazuddin, PRGMEA Regional Chairman, stated that the EFS is not a luxury — it is a necessity for export-led growth. The garments industry is entirely export-oriented and sits at the end of the textile value chain, bearing the brunt of delayed refunds and multiple taxes. Exporters already pay sales tax upfront and wait for months to receive refunds, often facing a three-month delay, which severely hampers cash flow and operational capacity. Imposing additional taxes on top of this already burdensome system would be disastrous.
Copyright Business Recorder, 2025
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