Pakistan Textile Industry Opposes The Government's VAT Proposal

The Pakistan government recently proposed that 18% of value added tax (VAT) be imposed on the textile sector in the forthcoming budget, and all textile related trade institutions unanimously opposed the proposal of the government. They said that the government's proposal was too arbitrary in light of the economic turmoil and the impact of the resulting economic slowdown on the textile sector.

The towel manufacturers association, the textile processing association and the bedding Exporters Association asked the government to reconsider its plan. They said that the new proposal was to duplicate the goods service tax. This year the textile industry has regressed, and the implementation of value-added tax will destroy the domestic textile industry.

Earlier, the textile department was proposed to impose zero tax rate, but now the government is increasing the burden of the textile sector, which will eventually lead to tax evasion. Exports from the textile sector will decline, and today the textile sector contributes 60% to its exports. They also say that most countries are cancelling taxes, but Pakistan is prepared to implement this obsolete tax policy.

Editor in chief: Xu Qiyun