Pakistan Hosiery Manufacturers and Exporters Association (PHMEA) has sought zero-rated facility for the textile industry as this would help revive exports and earn much-needed foreign exchange. The government imposed a refundable 17 per cent sales tax on exports of these sectors in Budget 2019-20, which blocked their working capital and hindered growth in exports.
PHMEA demanded exclusive treatment through the de-merger of textile from the Ministry of Commerce, proposed levy of duty on export of cotton yarn (raw material for value-added textile), withdrawal of duty and taxes on purchase of locally produced raw material and zero sales tax on supply of power and gas.
It said the duration for receipt of export payments from international buyers should be increased to 365 days compared to existing 180 days as they were facing difficulties in receiving the payments under the global lockdown. The PTI government merged the Ministry of Textile with the Ministry of Commerce last year. The hosiery association requested the government to de-merge textile and make it a standalone ministry keeping in view the importance of textile industry.