Government-APTMA Talks End In Stalemate

The talks between government and All Pakistan Textile Mills Association (APTMA”s) to postpone the latter”s strike call of August 7 failed to produce results on Saturday after the Finance Ministry refused to accept industry”s demand for withdrawal of recently imposed surcharges on electricity along with Gas Infrastructure Development Cess (GIDC).
Talking to media after a meeting between government team and APTMA delegation, Special Assistant to Prime Minister for Revenue Haroon Akhtar said that a cut in electricity prices for a specific industry would not be possible for the government even though the price of electricity in Pakistan is higher in the region.
He said the GIDC was imposed after government won the case in the Supreme Court. He however, said that the government may introduce a package for the industry, which would be linked to investment. Responding to questions, he said the Pakistan Tehreek-e-Insaf (PTI) and Pakistan People”s Party (PPP) cannot support traders” strike because Asad Umar and Saleem Mandviwalla have supported 0.6 withholding tax on banking transactions through their speeches in parliament.
“I got the transcript of Asad Umar”s speech in the Parliament,” Haroon Akhtar said, adding that the government was ready to facilitate traders but would not accept any ”benami” transaction. He further stated that the government would soon bring a law in the parliament against ”benami” transactions. He also acknowledged that the problem of industry is that it is unable to compete in the region owing to high cost of doing business. APTMA Chairman S. M. Tanveer said that decision whether or not to call off the announced strike for August 7, 2015 would be taken by their general body meeting scheduled for Monday.
He said that surcharges on electricity and GIDC were not acceptable to the industry because cost of electricity was almost twice in Pakistan compared to other regional countries. He said that electricity price in Pakistan was Rs 14.50 per unit against Rs 7 to Rs 8 in other regional countries. Tanveer added that the export-oriented industry would not sustain a Rs 170 billion burden in the form of surcharges on electricity worth Rs 72 billion, GIDC Rs 38 billion and other taxes, Rs 60 billion. He added that the Finance Minister has constituted three committees with the one headed by Special Assistant to Prime Minister on Revenue on viability issues of the industry and taxes while the second one with Chairman FBR on refund and other taxes. The committee on Commerce has already been constituted and working to look as to how the industry can be facilitated – the export-oriented industry on local taxes. He urged the government to reduce tax on export industry to zero, as APTMA wants the country exports to rise.
He said that 30 per cent of the industry is already shut and rest would also not be able to survive if these problems were not resolved. A statement issued by Finance Ministry said that Finance Minister Ishaq Dar chaired a meeting with the delegation of APTMA and held a detailed discussion on issues faced by the textile industry. The delegation drew the Finance Minister”s attention towards resolving issues relating to levy of surcharge on electricity bills, settlement of sales tax refunds, removal of anomaly in taxes as well as restraining import of yarn, aiming at promoting the local industry. Dar was given a detailed briefing about current profile of the Pakistani textile industry and its standing in the international market. The Finance Minister said that the matter regarding sales tax refund would be resolved on priority. He said the government had already asked for filing of refund claims by 31st of August so that priority settlement of these claims could be carried out.
The Finance Minister constituted a committee comprising representatives of APTMA and government officials, headed by Special Assistant to PM on Revenue, Haroon Akhtar to further deliberate on these issues. The APTMA delegation vowed that given the right kind of incentives, textile industry would be able to play its due role in enhancing country”s foreign exchange earnings. The delegation thanked the Finance Minister for taking out time from his busy schedule for this important meeting. Members of the delegation were in agreement with the Minister that promoting tax culture in the country was the key to economic prosperity. They assured him of full support on all matters aimed at economic betterment of the country and said any attempt at disrupting the process of economic development would be discouraged. The SAPM on Revenue, Haroon Akhtar, CEO TDAP, S. M. Muneer, Secretary Textile, Ameer Mohammad Khan Marwat, Secretary Commerce, Shahzad Arbab, Acting Secretary Finance, Dr Shujaat Ali, Additional Secretary Finance, Tariq Mahmood Pasha, Chairman FBR, Tariq Bajwa, Joint Secretary, Finance Awais Manzur, Chairman APTMA, S. M. Tanveer, Group Leader APTMA, Gohar Ejaz and Mian Mohammad Idrees, President FPCCI, attended the meeting.