LCCI President Anwar Addresses Export Sector Concerns

The Pakistan Carpet Manufacturers and Exporters Association (PCMEA) has raised concerns about the potential impact of subjecting the export sector to standard taxation. During a meeting with Lahore Chamber of Commerce and Industry (LCCI) President Kashif Anwar, the delegation led by former LCCI president Shahid Hassan Sheikh emphasized the need for the export sector to remain exempt from regular tax regulations to avoid adverse effects on businesses.

The delegation highlighted that including exports in the standard tax regime could result in reduced revenues, decreased dollar inflow, and increased inflation. There were fears expressed that exporters might opt to move their operations to countries with more favorable tax environments, such as the UAE. To support the export industry, the delegation called for the implementation of export-friendly policies and the establishment of a stable five-year export policy unaffected by future budget changes.

Moreover, the delegation criticized recent government decisions, including the significant increase in financing rates for government facilities, the withdrawal of incentives like Duty Drawback of Local Taxes and Levies (DLTL), and the impending removal of the fixed tax facility. They also demanded a review of agreements with Independent Power Producers (IPPs) to reduce electricity costs, a decrease in gas prices, and the reinstatement of export subsidies.

LCCI President Kashif Anwar acknowledged the challenges faced by exporters due to currency devaluation and rising energy costs. Despite these obstacles, Pakistan's exports have reached 30 billion dollars in the past three years, thanks to governmental support and exporters' efforts. Anwar cautioned against revoking export facilities, as it could lead to a decline in export volumes, emphasizing the importance of maintaining the current tax regime for exporters.

Anwar stressed the necessity of thorough consultations before implementing any tax changes affecting exporters. He highlighted the negative consequences of subjecting exports to standard taxation, particularly mentioning the shift from a one percent final tax on turnover to regular taxation. Anwar expressed optimism for a swift resolution of the issue to protect the interests of the export sector.

The concerns raised by the Pakistan Export Sector regarding the potential impact of standard taxation on exports highlight the importance of maintaining a conducive environment for businesses to thrive. It is crucial for policymakers to consider the implications of tax changes on the export industry and work towards implementing measures that support sustainable growth and competitiveness in the global market.