Pakistan to introduce TTS to prevent tax evasion in domestic cotton sector

In a bid to bolster tax revenue and ensure transparency in the cotton industry, the Pakistani government has announced plans to implement a Track and Trace System (TTS). This move comes as a response to concerns over widespread tax evasion within the sector.

The TTS will be applied to locally produced cotton bales, allowing authorities to monitor the entire supply chain from the farm to the ginning factory. By tracking the movement of cotton, the government aims to prevent underreporting of production and tax evasion, which has been a persistent issue in the industry.

Rana Tanveer Hussain, Minister for Industry and Production, emphasized the importance of the cotton industry to the rural economy and its potential to create jobs. He stated that the TTS will not only protect local farmers but also safeguard the interests of the industrial sector.

The government is also considering proposals to amend the sales tax on cotton seed and cotton seed cake, addressing concerns raised by the Pakistan Cotton Ginners Association (PCGA). Additionally, the Cotton Control Act will be enforced in collaboration with provincial governments to ensure compliance with industry regulations.

Industry experts believe that the implementation of the TTS is a positive step towards formalizing the cotton sector. By improving transparency and accountability, the government hopes to create a level playing field for all stakeholders and boost the overall competitiveness of the Pakistani cotton industry.