ISLAMABAD: Prime Minister's Advisor on Commerce and Investment, Abdul Razak Dawood Saturday said the State Bank of Pakistan (SBP) will start crediting duty drawbacks in the accounts of exporters from September 1, 2020.
The persistent capital crunch faced by the textile and garment sector due to stuck up sales tax refunds and other duty drawback refunds has exacerbated the situation by adding to the already increasing cost of doing business.
The previous government had announced in STPF 2015-18 that the exporters will get duty drawbacks from the SBP directly after submission of required documents and certificates of exported consignments.
"Exporters have always wanted that their refunds go directly into accounts directly from the SBP. I am pleased to announce that effective next month, the SBP will be crediting the duty drawbacks directly into their accounts," he added.
Commerce Advisor also appreciated the SBP and Customs for establishing the system of direct transfer of duty drawback, without any human involvement on the initiatives of Commerce Ministry.
The STPF 2020-25 which is yet to be approved by the Cabinet, envisages incentivising 26 non-traditional sectors to boost exports by shifting powers of clearing claims of duty drawbacks, and local Taxes and Levies (DLTL), refunds to SBP so that exporters get their claims as they submit their Goods Declaration (GDs).
The Commerce Ministry had proposed to shift duty drawback and DLTL to SBP from Federal Board of Revenue (FBR) which always delayed refunds due to which exporters faced capital issues.
Copyright Business Recorder, 2020