Government to remove duties on raw material ‘not produced locally’
The Advisor to Prime Minister also said the custom duty will be reduced to make Pakistani products more competitive.
The Advisor to Prime Minister on Commerce & Investment, Abdul Razak Dawood, has said that regulatory duty and additional duty on raw materials being produced abroad will be abolished.
Speaking to delegates from the Lahore Chamber of Commerce & Industry (LCCI) on Saturday, the minister said that the government would also reduce customs duty applicable to such inputs to make Pakistani products more competitive in the global market.
He announced that banking agreements with Uzbekistan and Afghanistan were in progress, and once these agreements come into effect, trade with the two states will be regularised.
The advisor added that councils were being established to enhance exports of dates, kinnow, leather, mango, and potato. He also expressed optimism that this move would yield exceptional results for the economy of Pakistan.
“The main objective of the government is to stabilize the country’s economy, and struggles are being made to achieve that goal,” Dawood said.
Speaking on occasion, the LCCI President, Mian Tariq Misbah, said that the steep rise in trade deficit needed pressing attention of the government.
“Our trade deficit during July-December (2020) stood at $12.36 billion, which is almost 6% higher than $11.67 billion recorded during July-December 2019,” he said.
He further urged that the process of release of refunds for exporters needed to be rationalized. He said that a technical error in the refunds system resulted in improper disbursements of the refund amounts.
Simultaneously, erroneous notices were also issued to the business community members, and false cases were registered against them.
He advised the minister to play a supporting role in this matter so that the business community was not victimized wrongly.
“The authorities should focus on fixing the technical problems in sales tax e-refund system to ensure fast and transparent issuance of refunds to the exporters,” he said.
It was proposed that to boost Pakistan’s export competitiveness across diverse sectors, the incentives that are being provided to the export-led sectors should also be extended to other industries, including pharmaceutical, rice, halal meat, and engineering segments.
Misbah further emphasized that refunds of these sectors should also be processed through the new faster system.
The official pointed out that the engineering sector held great importance in the global economy as its international trade share stands at around 52%.
Nevertheless, no tax incentives were being offered to the engineering sector in Pakistan.
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