APTMA sought remedial measure to achieve textile export target

A research study prepared by the All Pakistan Textile Mills Association (Aptma) reports that the Pakistan textile industry is impaired due to heavy taxes and surcharges, rendering it uncompetitive compared to regional economies. As per the report, other irritants include energy tariff, under utilization of power generation capacity and energy shortage.

The export sector is subject to five percent duties, taxes and surcharges, while competitors in India enjoy tax-free regime on exports of textile products. While in Bangladesh and China, levies on exports are around one percent.

The report, citing the World Trade Organization, said this tax structure resulted in only 18 percent growth in Pakistan’s textile and clothing exports during 2006-2014, while Bangladesh posted 175 percent growth, China 107 percent and India 96 percent during the same period.

The All Pakistan Textile Mills Association (Aptma) said that one percent turnover tax has also pushed up the cost of production and there is no concept of such a tax in other three regional countries.

Besides, it said the aggregate corporate tax, including workers participation profit fund of five percent and workers welfare fund of two percent, turns out to be 40 percent. In Bangladesh, it is 27.5 percent and in India and China the same is 25 percent.

While six percent interest rate in Pakistan is lower than India, it is still higher when compared with Bangladesh (five percent) and China (5.4 percent).

Pakistan’s textile exports peaked to $13.8 billion in 2010/11, but after falling to $12.4 billion in 2011/12 they regained momentum to touch $13.1 billion and $13.7 billion in 2012/13 and 2013/14, respectively. However, textile exports slipped to $13.5 billion in 2014/15.

The government, in its Economic Survey 2014-15, admitted that global textiles and clothing trade substantially increased since the post-quota regime, but Pakistan’s share in the international textile trade remained stagnant due to preferential trade agreements signed among various countries.

Textile ministry, in the industry’s policy 2014-19, expressed its objectives to double value-addition to two billion dollars / million bales and annual exports to $26 billion during the five years.

The All Pakistan Textile Mills Association targeted up to $20 billion worth of textile exports by 2018 through creating eight million new jobs in the value chain. To achieve this milestone, the All Pakistan Textile Mills Association (Aptma) sought immediate remedial measures, including withdrawal of various surcharges on electricity and gas. It also sought the reduction of corporate tax rate to 25 percent and turnover tax to 0.5 percent.

Recent Posts

Lenzing Nonwovens expands LENZING lyocell dry fiber line

Lenzing Nonwovens has expanded its LENZING Lyocell Dry fiber range with two new cellulosic fibers: a fine dry fiber and…

6 hours ago

Avery Dennison unveils Optica for supply chain transparency

Digital identification expert Avery Dennison has launched a new platform designed to increase transparency across brand and manufacturing supply chains.

6 hours ago

Aware and Baichuan Resources partner for textile transparency

Traceability platform provider Aware has announced a collaboration with Baichuan Resources Recycling, a leader in recycled polyester, yarn, and fabric…

6 hours ago

Indorama Ventures partners for commercial-scale bio-PET bottles

Indorama Ventures has teamed up with Suntory, Iwatani, and others to introduce the first commercial-scale bio-PET bottle, made from certified…

1 day ago

Milliken & Company launches innovative moisture barrier

Milliken & Company has introduced Milliken Assure, first flame-resistant moisture barrier for firefighter turnout gear that is free from PFAS…

1 day ago

Paradise Textiles, Kintra Fibers launch bio-synthetic material garment

Paradise Textiles has collaborated with Kintra Fibers, a leader in bio-based fibers, to produce the first garment made from Kintra’s…

1 day ago