Daily Times

Pakistan Businesses Forum (PBF) President, Sahibzada Muhammad Usman Zulfiqar has demanded the government to set up 5 mega textile parks in the budget 2021-22, saying this will make the industry globally competitive.

In the budget proposals shared with the press on Tuesday, he said that in last year’s finance bill, the textile industry had been completely ignored and deprived of relief. “There must be consistency in the policies and no way back for quite some time for the long run growth and development while overnight shift in policies has also been disadvantageous” he remarked.

He said Pakistan has a continuing balance of payments crisis and is being financed by local and international borrowing. More debt piling or borrowing is not a feasible solution. Therefore, this challenge can be overcome only by increasing exports, he stressed.

The PBF president said the government through Finance Act 2013 had raised the general rate of minimum turnover tax under Section 113 of the Income Tax Ordinance 2001 to 1% from 0.5%, which was further increased to 1.5% through Finance Act, 2019 and we proposed the minimum turnover tax should be abolished for the coming year. Indirect exporters may also extend the taxation regime available to direct exporters.

As far as corporate tax rate is concerned, the current corporate tax rate is 29% in Pakistan whereas in Sri Lanka, Bangladesh and Vietnam it is 28%, 25% and 20% respectively. The PBF suggested that this rate should be brought down to 25%. Similarly the government could make it compulsory for the large spinning units having more than 30,000 spindles to grow their own cotton to manufacture cotton yarn and extend full support to them because country textile exports could not be enhanced without increasing the area under cotton cultivation and yield.