NKATI appeals for continuation of DLTL policy

KARACHI: The withdrawal of DLTL policy will destroy business, especially domestic exports, and exporters will face a financial crisis, an official said on Tuesday.

North Karachi Association of trade and industry (NKATI) president Faisal Moiz Khan expressed deep concern over the lack of clear policy regarding the drawback on local taxes and levies, and has been discontinued from July 1, 2022, and that the banks will not take any documents after the date in this regard.

In a letter to adviser to the Prime Minister on Commerce and Investment Abdul Razak Dawood, NKATI president said that DLTL policy was announced for five years.

The State Bank of Pakistan (SBP) is not accepting the documents of the exports which are going on from July 1, due to which all the banks of Pakistan are also refusing. This issue should be resolved immediately and the policy of DLTL should be continued, he added.

“If DLTL is skipped in the middle, it will adversely affect Pakistan’s exports and exporters will be economically disadvantaged, and their export will be ruined. It is not possible to export goods as well as taxes from Pakistan, which is one of the impossibilities. If DLTL is not refunded, then it creates a negative impact on exports”, Khan said.

The ministry of commerce has provided the facility of duty drawback on local taxes and levies to textile, non-textile and exporters under SRO. 711(I)/2018. The exporters’ commitment from foreign buyers will also be affected which will also cause irreparable loss to export orders, urging the government to adopt a positive strategy in this regard and play its role.

He lamented the fact that despite the passage of six months, no positive and coherent policy has yet emerged from the government nor have the banks been informed and provided with a comprehensive policy about DLTL.

Khan said that the 17 per cent sales tax should be withdrawn as raw material cost has increased tremendously and at the same time shipping freight has also increased, along with the increase in cotton prices making it impossible to compete with the international market.

“At the same time, the sales tax that has been imposed on the export processing zone, is also inappropriate which is likely to affect exports. If Pakistan’s exports are affected, then Pakistan will face a never ending economic crisis due to which trade activities will stop,” he warned.

Faisal appealed to the adviser on commerce and investment that in order to save business, especially domestic exports from destruction; the government should continue DLTL policy, saying that it is imperative for the government to formulate a comprehensive and positive policy on DLTL to facilitate exporters.