KARACHI - Karachi Chamber of Commerce and Industry (KCCI) President Shamim Ahmed Firpo has urged the government to immediately settle pending refunds claims in order to save manufacturers-cum-exporters, particularly small exporters, from suffering severe liquidity crunch.

The KCCI president said 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 Rs300 billion of textile industry alone were stuck up with FBR, resulting in intensifying the hardships for the industry. The government must realise 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, he added.

Referring to a recent statement by 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 PM’s Rs180 billion exports incentive package, 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.

Firpo recalled that under the prime minister’s directives, Sales Tax refunds of up to Rs22 billion were settled in August 2016 which was followed by another settlement of refunds claims of Rs21 billion in 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.

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.

The KCCI president hoped that the government will comes up with pro-business initiatives soon as only such initiatives can rescue Pakistan’s economy from the clutches of IMF.