Cost of second-hand clothing imports up five times

28 Mar '11

2 min read

Pakistani importers recently claimed that, riding on the back of additional sales tax (ST) and increase in customs duty and income tax rates, the cost of importing used garments has gone up five times.

Meanwhile, the double-digit inflation in the country has caused the imports of used clothing to plummet by over 50 percent to Rs. 558 million during September 2010 to February 2011.

Muhammad Usman Farooqi, the Patron-in-chief of the Pakistan Second-hand Clothing Merchants Association (PSCMA) said that, the Federal Board of Revenue, through SRO-509 promulgated on March 15, 2011, imposed a 17 sales tax and also raised the income tax in respect of the same by five percent to six percent and customs duty on imports by five percent.

He revealed that, previously the import of second-hand clothes was not subject to the sales tax levy, but subsequent to the imposition of the GST and rise in the customs duty and income tax rates, cost of importing second-hand clothing has gone up, like for instance cost of importing a container of second –hand clothes initially came to Rs. 14,000, now it comes to Rs. 18,500.

He claimed that, not only the 100,000 people, who find direct or indirect employment in this trade, would be affected by the decision, but would also cause the poor section of the society too will have to bear the burden of substantial rise in the prices of used clothing.

The country's overall imports of second-hand clothing from USA, Korea, Europe, Japan and Australia during the September-February 2010 period came to Rs. 785 million.

Fibre2fashion News Desk - India

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