Pakistan’s APTMA alleges misuse of Export Facilitation Scheme post tax changes

The All Pakistan Textile Mills Association (APTMA) has raised alarm over the misuse of the Export Facilitation Scheme (EFS) following the withdrawal of sales tax exemption on local supplies for export manufacturing under the Finance Act 2024.  This change has led to a rise in yarn and other intermediate imports, which are being illegally sold in the domestic market, displacing domestic industries and impacting millions of livelihoods, APTMA chairman Asif Inam says.

Inam emphasized the removal of zero-rating on local supplies, intended as a revenue measure, is harming the economy by stifling business activity. Small and medium enterprises, already burdened by high energy costs and taxes, have been hit hardest. Delayed sales tax refunds add to their financial woes.

APTMA has called for restoring the EFS to its pre-2024 form and implementing stricter checks to prevent illegal activities, warning that further damage to the upstream textile sector is imminent if the government does not act swiftly.