KARACHI: Towel Manufacturers Association of Pakistan (TMA) has expressed concerns over FBR’s proposed Simplification of Export Promotion Scheme with a number of observations.
Feroze Alam Lari, Chairman TMA, tagged his apprehensions to a proposed FBR draft # C.No:5(7) EP/2019-Pt on the Simplification of Export Promotion Scheme.
His observations said that an SRO 450(1) was introduced in 2001 related to DTRE Rules to facilitate the manufacturers and the exporters, but it did not truly support the export oriented industry. Manufacturers were not getting full advantage of the scheme, so the Government introduced an SRO 327(1) /2008 to provide better support to the Industry.
This Simplification of Export promotion Scheme draft is just like the DTRE rules and gives a lot of discretion power to the government officials which will open the door of corruption and will create lot of hurdles for the genuine manufacturers-cum-exporters, according to him.
According to the draft, at the time of goods import, applicants need to submit a bond and I.B. to the department for one year as well as need to resubmit the Bond and I.B. to release the goods which is duplication as well as it will create extra financial burden on the exporters.
In the proposed Scheme Point 7 ‘Processing of the application for import authorisation’ it is mentioned that after determining the input/output and production capacity, IOCO will issue an analysis certificate showing the quantity of input required to manufacture output along with wastage.
So the manufacturers are bound to import only the selected quantity as this point reflects the concept of DTRE. It is impossible for the textile sector to provide exact import quantities in advance due to change in product mix which will result in change of quantities of input goods used for manufacturing of goods.
Estimated quantum of goods imported for the consumption in a year, if the importer is unable to consume the same as per their estimated then the officials have authority to reduce the quantity in the next year as per their consumption. No option has been given to add the quantity. Not good for the manufacturers.
For the Sales Tax Refund, Export Oriented Units are using ‘FASTER’ system which is easy for the exporters to claim their refund but in the proposed scheme Point 22 ‘Refund of Sales Tax’ will be on the basis of annual reconciliation statement. It is not favourable for the exporters.
This draft showed the authorised period for 5 years but working on only a year to year basis. It is not in the favour of manufacturers.
This draft totally ignored the Ministry of Textile, Ministry of Commerce (Trade Development Authority) and related Trade Association and involved the SEMEDA and empowered IOCO which is not a positive nod for the manufactures.
Feroze Alam Lari has urged the relevant authority to take on board all export oriented associations and incorporate their valuable suggestions before preparing the draft of the same for this new simplification scheme to become more fruitful for the manufacturers cum exporters.
Copyright Business Recorder, 2021
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