FBR Urged Exporters to get Benefits from New Export Promotion Schemes
Iqbal Munir said that there are mainly five different export promotion scheme including, Manufacturing Bonds Scheme, Export Oriented Schemes (EOS), Duty and Tax Remission for Exports (DTRE) Scheme, Temporary Importation scheme (TIS), Export processing Zones (EPSs).
Islamabad, 12 November 2019 (GNP): Chief of Exports, Federal Board of Revenue (FBR), Iqbal Munir on Tuesday apprised different stakeholders including exporters from different industries on newly launched export promotion, facilitation & exemption schemes of the government and urged the business community to get maximum benefits from these schemes to help boost country’s exports.
He was addressing the first Public Private Dialogue Forum (PPDF) Round table Meeting to Review Export Promotion & Exemption Schemes 2019-20, organized by the Sustainable Development Policy Institute (SDPI) in collaboration with The United States Agency for International Development (USAID) funded Pakistan Regional Economic Integration Activity (PREIA) project.
Iqbal Munir said that there are mainly five different export promotion scheme including, Manufacturing Bonds Scheme, Export Oriented Schemes (EOS), Duty and Tax Remission for Exports (DTRE) Scheme, Temporary Importation scheme (TIS), Export processing Zones (EPSs). He said that these schemes have been fully automated in order to minimize the human interaction and to help ensure in ease of doing business which would resultant in boosting exports. “The benefits under different schemes against certain conditions include exemption of duties and taxes on all the imported goods including raw material to machinery and capital goods” he said adding the need for increasing awareness about the export promotion schemes among businesses and exports all around the country.
Joint Executive Director, SDPI, Dr. Vaqar Ahmed said that despite the desired by the government for increased tax revenue amid an environment of low economic expansion, exporters may continue to face a constrained macroeconomic environment. He said that upward trend in the exports during the period of July-September FY20 and rise in State Bank reserves was a positive sign which may give confidence to local and foreign investors. “For the medium to longer term, the key for economic revival will be sustained increase in exports which should not be confined to traditional sectors,” he said adding in this regard, FBR can help the private sector in improving its understanding around how to access export exemption schemes allowed for imports.
Dr Vaqar said that while some exporters are utilizing duty drawback scheme, however it seems that accessing other schemes such as Duty and Tax Remission of Exports (DTRE), Manufacturing Bond, Export Oriented Unit & SME Scheme, and Temporary Importation Scheme, seems difficult. “The analysis by SDPI reveals that private sector may be able to better utilize these schemes if time to process application at FBR is reduced, and costs involved in application and delays in receiving duty rebates is rationalized,” he added. Audit may be made risk-based so that reputed exporters do not have to wait for longer time period for processing of their applications, he underlined. He also stressed the need for regular and timely revision of statutory regulatory orders (SROs) which regulate these export exemption schemes.
Chief of Party, USAID-PRIEA project, Hussan Bano Barki said that Pakistan Regional Economic Integration Activity (PREIA) project aim to focus on trade promotion and facilitation in Pakistan to improve trade and transit competitiveness. She said that an enabling environment and improved policy is the key for export competitiveness of the country. For that an informed public private dialogue for building consensus is necessary, she added. She also stressed the need for enhanced exports growth to reduce the trade deficit.
Shahid Ali Khan, Director, State Bank of Pakistan (SBP) said that there are 3.2 million entrepreneurs in the country, of which 90 percent are small and medium enterprises (SMEs). He said that majority of the SMEs either don’t have access to financing facilities provided by the SBP or these enterprises have little knowledge. “Despite high discount rates in the country, the SBP has already announced the lending facility up-to 200 million rupees for SMEs at 6 percent markup, where export oriented enterprises can get financing facilities,” he added.
President Islamabad Chamber of Commerce and Industries (ICCI), Muhammad Ahmed lamented that FBR and other regulatory authorities favor the public limited companies and corporate sector mostly and other SMEs are not provided with same facilitations. He said that regulatory bodies should provide level playing field to all the business around the country equally for healthy market competition. While highlighting the technical issues in exporting goods, he said time consuming documentation and bureaucratic hurdles are the major challenges of improving exports.
Chairman, Faisalabad Garment City Company (FGCC), Rehan said that these export promotion schemes on paper seems very easy but practically are very difficult to materialise. He said due to the current tax regime, there is hardly any commercial export left. He said unwarranted delays in audit and renewal of documentation by the FBR are also hurting our exports. Azhar Majeed, representing the business community stressed upon FBR for improvements in their automation system, where records and data was outdated, to help the businesses to get updated information. Representative of Trade Development Authority of Pakistan (TDAP) on the occasion urge the need for collective and synergizing efforts to raise awareness around export promotion schemes to help the businesses to enhance their exports.
The meeting was also attended by the representatives of Security and Exchange Commission of Pakistan (SECP), Rawalpindi Chamber of Commerce and Industries (RCCI), Export Development Fund, Pakistan Institute of Development Economics (PIDE), Export Processing Zones Authority (EPZA), All Pakistan Textile Mills Association (APTMA), Surgical Instruments Manufacturing Association of Pakistan (SIMAP) and members of different business association. (GNP)