LAHORE, March 1: The All Pakistan Textile Mills Association (Aptma) has opposed the Federal Board of Revenue (FBR) decision increasing withholding tax on import of all textile raw materials and machinery from one per cent to five per cent through SRO140(i) 2013 issued under section 148 of Income tax.

Addressing a press conference on Friday Aptma Chairman Ahsan Bashir said this measure would unnecessarily burden the textile exporters with Rs10 billion of refund claims.

He said income tax on all exports was one per cent that the textile exporters pay at the time of export of consignment at the customs terminal.

He said the textile industry annually imported cotton worth $1 billion and man-made fibres worth $1 billion, which were basic raw materials for the industry that exported 80 per cent of the textiles it produces.

He said $2 billion converted into local currency came to be Rs200 billion and the after increase in withholding tax they would have to pay Rs10 billion tax to the authorities at the import level. He questioned the wisdom of collecting this tax from the industry when the FBR would eventually be refunding the amount. He said the hassle the industry faced in refunds was well-known to all. Still billions of rupees in refunds dating back to several years were pending with the FBR, he added.