Home / Knowledge / News / Leather industry raises concerns on double taxation
Leather industry raises concerns on double taxation
21
Jun '08
Mr. Fawad Ijaz Khan, Chairman Pakistan Leather Garments Manufacturers & Exporters Association (PLGMEA) expressed serious concerns of the Leather Garments Industry on Double Taxation at the Import & Export Stages.

The Federal Budget 2008-09 has imposed 2% uniform withholding tax for all importers and exemption certificate for Non-Payment of this tax is not being issued to Manufacturer-cum-exporters.

Now the exporters will have to file for refund of Withholding tax which is a very lengthy and cumbersome process. Consequently a huge amount of their funds will be stuck up in Income Tax Refunds.

Mr. Fawad elaborated that the export proceeds of Leather Garment exporters are taxed at 1% under Section 154 of Income Tax Ordinance 2001 which is considered full and final discharge of tax liability of the exporters.

Manufacturers-cum-exporters who were registered in the Sales Tax Department were exempted from 1% withholding tax at the import stage vide the Federal Budget 2006-07.

Previously Income Tax Department was issuing exemption certificate to Manufacturer-cum-exporter so that they did not have to deposit withholding tax at Import stage.

Now 2% withholding tax has been imposed on all imports after the announcement of Federal Budget 2008-09. The Income Tax commissioners have not been extended the powers to issue Exemption Certificates.

Mr. Fawad said that some exporters who had exemption certificate valid till 30th June 2008 are also being charged 2% withholding tax on imports from 12th June 2008.

Mr. Fawad stated that several shipments are lying at ports since the Customs authorities are demanding 2% withholding tax and he has again requested the Member Income Tax FBR Mr. Usman Khalid to take note of this serious problem of exporters and urgently give instructions to Regional Tax Commissioners to issue Exemption certificates to Manufacturers-cum-Exporters based on their past history.

Mr. Usman assured the PLGMEA Chief that he will look into this problem and find a solution for exporters within next few days.

Mr. Fawad has also discussed this double taxation issue with Mr. Israr Rauf, Director General, Regional Tax Office, Karachi for issuance of Exemption Certificate.

It may be pertinent to mention here that recently SBP has imposed a condition of 35% cash margin on opening L/C for imports which has already overburdened exporters importing essential Raw Materials.

Mr. Fawad stated that there is acute shortage of Leather in the local market and its prices are rising sharply. Exporters are forced to import most of their Leather requirements besides the Import of Chemicals and Garment Accessories.

Mr. Fawad talked to Dr. Shamshad Akhtar, Governor State Bank of Pakistan and according to her the delay in issuing notification for withdrawal of 35% L/C margin is at the end of Ministry of Commerce and Ministry of Finance who have still not finalized the list of items on which 35% L/C margin is to exempted.

According to Dr. Shamshad she is continuously following this case with the Ministry of Finance. Mr. Fawad appreciated the efforts of Governor SBP for early withdrawal of 35% L/C margin condition.

Pakistan Leather Garments Manufacturers & Exporters Association


Must ReadView All

US announces final CVD on fine denier PSF from China, India

Textiles | On 19th Jan 2018

US announces final CVD on fine denier PSF from China, India

The US secretary of commerce Wilbur Ross recently announced the...

EU consumers to gain from cheaper, safer, better e-payments

Apparel/Garments | On 19th Jan 2018

EU consumers to gain from cheaper, safer, better e-payments

European consumers can now reap the full benefits of paying online...

Courtesy: Epson

Textiles | On 19th Jan 2018

Epson's new SC F2100 enhances DTG printing

Epson, a leader in inkjet printers and digital textile printing...

Interviews View All

Karan Toshniwal
Orange O Tec

Contemporary industry is paying more and more attention to the...

Manfred Mentges
Sedo Treepoint GmbH

We see a higher demand in colour management systems, as customers see big...

Evelyne Cholet
UCMTF

‘France had a reputation of being big in new ideas, but poor in marketing...

Ravindra Jain, Ashish Baid

Oswal Prints Private Limited has been manufacturing and exporting ethnic...

Liz Manning

<div><b>Liz Manning</b>, Business Development Manager at Catexel, has...

Rikesh Mistry

Jupiter Comtex Pvt Ltd, established in 1973, started its textile machinery ...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

January 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
69.1%
No
13.4%
Skip
17.5%

Total Votes: 97

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.9%
No
28.9%
Skip
7.2%

Total Votes: 97

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.6%
No
9.3%
Skip
3.1%

Total Votes: 97

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
82.5%
No
8.2%
Skip
9.3%

Total Votes: 97


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search