KARACHI: President of the Karachi Chamber of Commerce and Industry (KCCI) Shamim Ahmed Firpo, while referring to numerous requests received from KCCI members, urged the government to immediately settle pending refunds claims in order to save manufacturers-cum-exporters, particularly small exporters, from suffering severe liquidity crunch.
In a statement issued, President KCCI added that the government must ensure availability of suffice liquidity to exporters if it was really serious in dealing with the issue of dwindling exports.
He said that the Federal Board of Revenue (FBR) has been continuously targeting the exporters by delaying billions of rupees refunds of sales tax, withholding, customs rebates, duty drawback on taxes & levies for achieving its budgetary revenue collection targets. “FBR is focused only on further squeezing the existing taxpayers, while no effort was being made to bring tax-evaders into the net for broadening tax-to-GDP ratio”, he added.
He noted that tax refunds of Rs300billion of textile industry alone were stuck up with FBR, resulting in intensifying the hardships for the industry. The government must realize the seriousness of the situation and take steps for timely clearance of all stuck up refunds with a view to provide some relief to perturbed business community.
Referring to a recent statement by Federal Commerce Minister Khurram Dastgir Khan in which he claimed that his ministry’s entire attention was focused on the reimbursement of tax refunds and other payments under Prime Minister’s Rs180 billion exports incentive package, Shamim Firpo asked that how will the government be able to settle huge refund claims with such a petty incentive package, particularly in a situation when refund claims of textile industry alone have escalated to above Rs300 billion. Delays in implementation of PM’s exports incentive package is also a matter of concern for the business and industrial community, he added.
Shamim Firpo recalled that under Prime Minister’s directives, Sales Tax refunds of up to Rs22 billion were settled in the month of August 2016 which was followed by another settlement of refunds claims of Rs21 billion in the month of November 2016 but it has been seven months now since the last payments against refund claims were made whereas such claims have been escalating every day, triggering extreme anxiety amongst many taxpayers.
In this regard, he advised the government to devise an automated system which must ensure release of all pending refund claims on monthly or quarterly basis which, if done, would enable the industrialists and exporters to efficiently devise their future business expansion strategies and create an enabling environment in which the businessmen and industrialists will be least bothered about the release of refund claims and they will stay focused on exploring ways and means of how to enhance their businesses and exports.
He opined that the improved economic figures along with positive developments taking place due to China-Pakistan Economic Corridor (CPEC) clearly indicate that Pakistan was headed in the right direction and was likely to become one of the fastest growing economies of the world but on the other hand, the government must act sensibly by ensuring a level-playing field to the business and industrial community so that they could be able to catch up with the pace and stay afloat in the extremely competitive business environment.
President KCCI hoped that the government comes up with pro-business initiatives soon as only such initiatives can rescue Pakistan’s economy from the clutches of IMF. “We are ready to utilize all our expertise and resources to promote industrialization and expansion but the government must also support us and refrain from taking anti-business moves and deliberate delays which hinder progress and prosperity for the country”, he added.