All Duties, Taxes Withdrawn on Cotton Import – Research Snipers

All Duties, Taxes Withdrawn on Cotton Import

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All duties and taxes on cotton imports have been withdrawn by the Economic Coordination Committee (ECC) of the cabinet. It has been permitted that cotton import can be done via the Torkham border land route from Afghanistan and the Central Asian States. It ensures and meets the growing demand of the textile value-added sector.

In the ECC meeting, headed by Adviser to the Prime Minister on Finance Dr. Hafeez Shaikh this decision was taken. It will be effective from 15th January 2020.

In 2014-15, the government imposed 1% customs duty and 5% sales tax on the cotton import. The import was subject to 3% regulatory duty, 2% additional customs duty and 5% sales tax. In January/Feb 2017 these duties were withdrawn and then re-imposed back in July-August.

The cotton crop assessment committee projected that the cotton production by the end of 2019 will be 10.20 million bales as against the target of 15 million bales for the fiscal year 2019-20.

ECC has permitted the cotton import from Afghanistan and the Central Asian States through the Torkham land route.

The commerce division has given a proposal for duty-free import of cotton to fill the gap. ECC was informed that by 1st Jan 2020 bulk of cotton will be lifted from the local farmers. Also, the proposed exemption would not negatively affect local farmers’ interests. Assurances were given by the commerce and national food divisions that imported cotton will facilitate textile exports.

Also read: One-third of Cotton Crop Destroyed in Pakistan

The national food security ministry was directed by Hafeez Shaikh to devise a comprehensive policy by consulting with the relevant stakeholders that will ultimately help in improving the local cotton production. It will serve the local farmers’ interests. Within one month, the policy should be submitted to the ECC.

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