By Staff Reporter
ISLAMABAD: Prime Minister Shehbaz Sharif scrapped a 0.25% surcharge on exports in a bid to ease burdens on the country’s shippers and sharpen their edge in global markets.
The move, announced Monday by the Prime Minister’s Secretariat, came during a meeting chaired by Sharif where officials reviewed recommendations from a working group focused on the Export Development Surcharge, or EDS. The surcharge had been levied on domestic exports, and Sharif directed its immediate abolition, according to the statement.
He also ordered a review of the Trade Development Authority of Pakistan to implement reforms and revamp the agency. The decision follows input from a dedicated working group on the EDS, convened earlier by Sharif and led by Musadaq Zulgarnain. The panel included private-sector representatives Shahzad Saleem, Misbah Naqvi, Khurram Mukhtar, Arif Saeed, Ahmad Umair and Sualeh Farugi, as well as State Minister for Finance Bilal Azhar Kiyani and Secretary Commerce Jawad Paul.
The group’s mandate was to assess the effectiveness of projects funded by the Export Development Fund, or EDF, and suggest steps to bolster the competitiveness of Pakistan’s exporters. After deliberations and building consensus, the working group submitted its recommendations to Sharif last week. Sharif issued directives for a third-party audit of the EDF covering the past five years, to be conducted in line with international standards. He stressed that the fund must be utilised to enhance domestic exports, support related research and development, provide skill training to the sector’s workforce, and provide world-class facilities. He added that any irrelevant or unjustified use of the fund would not be tolerated.
Officials also agreed to form an interim steering committee, led by the private sector, to oversee the allocation of the Rs 52 billion currently held in the EDF. The funds will be directed strictly to projects that contribute directly to export enhancement, focused solely on R&D and skill development, with no spending on infrastructure.
The meeting highlighted concerns over excessive taxation on exports, noting that the effective tax burden on exporters is currently much higher than on domestic businesses. A separate working group, convened under Shahzad Saleem, has already submitted its recommendations on addressing the tax burden in the export sector.
Sharif instructed that a competent private sector chairman be appointed to ensure the optimal use of the fund’s available resources. He resolved to promote and market Pakistan’s export products worldwide and emphasised that providing maximum support to industrialists to enhance domestic exports is one of the government’s top priorities.
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