APTMA urges finance minister to impose 18% sales tax on imported cotton, yarn, and grey fabric

The All Pakistan Textile Mills Association (APTMA) has written an urgent letter to Finance Minister Muhammad Aurangzeb, calling for the immediate imposition of an 18% sales tax on imported cotton, yarn, and grey fabric, reported 24NewsHd TV Friday.

The association has expressed serious concern over the delay in the issuance of the official notification, despite a clear policy announcement in the federal budget.

In the letter addressed by APTMA Chairman Kamran Arshad, the association reminded the finance minister that the Deputy Prime Minister’s Committee had approved the imposition of sales tax on these imported textile inputs starting July 15. However, nearly three weeks after the budget's passage, no formal notification has been issued, leaving the domestic cotton industry in limbo.

"The cotton crop buying season is about to begin, but there are no buyers for local cotton in the market," the letter warned, stressing that the lack of policy implementation has created uncertainty for local farmers and ginners. The association emphasised that fulfilling the tax parity promise is essential to prevent the collapse of the domestic cotton market.

APTMA argued that imposing the same tax rate on both imported and locally produced cotton would revive the local cotton industry, ensure fair competition, and provide relief to millions of Pakistani cotton farmers. "The Finance Minister must ensure the implementation of what was committed during the budget speech," the letter added.

The association further pointed out that while textile exports increased by $1.5 billion during the fiscal year 2024–25, Pakistan also imported $1.5 to $2 billion worth of cotton during the same period — resulting in a neutral trade effect. APTMA believes that supporting the domestic cotton sector through this tax measure will reduce reliance on imports and increase real export gains.