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PCMA urges end to hurdles in duty and tax remission for export rules implementation

KARACHI (February 09 2003) : The Pakistan Cloth Merchants' Association (PCMA) has demanded immediate removal of anomalies in the implementation of Duty and Tax Remission for Export (DTRE) rules.

The Central Chairman, PCMA, Ahmed Chinoy, in a press statement here, said that the DTRE system was, no doubt, beneficial for the exports, but since it contained several anomalies, the exporters were unable to benefit fully from these rules.

“It is estimated that there are 250,000 sales tax-payers in the country, but not more than 300 are registered under the DTRE,” he said.

Chinoy said this showed that due to complicated DTRE rules and unnecessary hurdles in its implementation, the exporters were discouraged to register themselves under these rules.

He, therefore, urged the Central Board of Revenue (CBR) to simplify these rules and make them exporter-friendly so that the majority of exporters could benefit from the DTRE regime.

The input tax adjustment claim for electricity and gas was proportionately allowed to the exporters, which was not very helpful to them, he said.

The PCMA chief asked the CBR to remove the condition that the gas/electric bills must contain the sales tax registration number and the exporter under the DTRE should be allowed 100 percent input tax adjustment on the basis of the address of the registered person on the bill.

Ahmed Chinoy said that there were major flaws in the DTRE rules, as these did not have provision of the Customs duty drawback and refund/adjustment on local purchases and supplies.

If this obstacle was not removed, the exporters would not be able to benefit from the DTRE rules and would continue to be discouraged to register themselves under these rules, he added.

The exporters should also be allowed to enhance the quantities allowed in their license on the basis of their future estimated export performance and there should be more flexibility allowed in its renewal, he said.

The PCMA chief urged the CBR to further amend the DTRE rules accordingly, so that majority of the exporters could get themselves registered and benefit from these rules, which would also increase the government's revenue substantially and boost the exports.

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