The business of wholesalers and retailers associated with textile processing mills has come to a standstill after the government introduced a sales tax of 17 and 20 per cent on the textile sector. APTPMA Chairman Mohammad Arif Lakhani held an emergency meeting which unanimously passed a resolution demanding an extension for sales tax implementation on CNIC basis besides continuing SRO1125 and zero rating till July 31, 2019. The association also asked the government to find a solution for sales tax issue by July 31 after holding negotiations with dyeing and weaving sectors along with textile retailers and wholesalers.

APTPMA former president Zubair Motiwala said imposition of 17 per cent and 20 per cent sales tax along will decline exports by 30 per cent. The Lahore Chamber of Commerce and Industry (LCCI) also warned the government that trading activities will come to a halt if the condition of disclosing CNIC details of sales to unregistered persons is not delayed for at least one year.

Under an amendment introduced by the government in the Sales Tax Act, sellers are required to include the buyer’s CNIC number on the sales tax invoices. However, the business community believes that this condition would result in a potential misuse of CNICs and can be used in fraudulent transactions of billions of rupees as reported from time to time.