Pakistan Cotton Ginners Association (PCGA) stated on Friday that more than half of the factories in Pakistan are currently non-operational due to the onerous tax burdens placed upon the industry,
PGCA Chairman Mr. Arshad, talking at a local gathering, emphasized the challenges faced by farmers in selling their cotton crop (known as “phutti”) and highlighted the adverse impact on the nation’s economy resulting from the insufficient supply of cotton to textile mills.
This shortfall has necessitated substantial investments in importing cotton and edible oil, amounting to billions of dollars. Following consultations with PCGA officials and cotton ginners, Mr Arshad underscored the heavy taxation on the cotton ginning industry, encompassing both income tax and a staggering 54% sales tax.
These taxes have rendered the industry’s survival untenable. He called upon the federal government to abolish the sales tax on cottonseed and cottonseed oil, asserting that this would not only revitalize the ginning and oil sector but also contribute to reducing ghee and edible oil prices.
Mr. Waheed Arshad commended the implementation of the “Trace and Tracking System” by the Federal Board of Revenue (FBR), expressing hope that this system would be extended to cover the entire ginning and textile industry. He anticipated that this measure would facilitate increased tax revenue collection for the state.
Furthermore, he welcomed the efforts of both provincial and federal governments and urged the prohibition of sugarcane cultivation in cotton-growing regions to meet the target of producing up to 20 million cotton bales this year.
The meeting also saw the presence of other prominent figures from the PCGA, including Haji Muhammad Akram and Chaudhry Muhammad Arif, among others.
