Criticising the Finance Bill 2024 for imposing additional burden on the textile units, potentially leading to the collapse of the entire sector, the All Pakistan Textile Mills Association (APTMA) has urged the Federal Board of Revenue (FBR) to reconsider the destructive measures proposed in the bill.
During a meeting with the FBR Chairman, APTMA vehemently protested the regressive and punitive tax and customs-related measures proposed in the Finance Bill 2024, describing them as an existential threat to Pakistan’s textile industry. APTMA argued, these measures may unequivocally damage this vital sector, undermining Pakistan’s economic stability and export capacity.
A few of the key concerns raised by APTMA included withdrawal of the zero-rating on local inputs for export manufacturing that may disadvantage domestic and cloth producers, imposition of a 2 per cent custom duty on cotton and MMF, a 2 per cent advance tax on export proceeds, liquidity crisis in the industry and high duties on PTA/PSF.
Besides exacerbating the current situation, the proposed measures may deter new investment in productive, export-oriented activities, leading to a decline in industrial capacity and increasing capital flight to the informal sector, said APTMA. This will reduce government revenue and worsen the fiscal deficit, creating a vicious cycle of economic decline and increasing the risk of sovereign default, it added.
