Fruit processing machinery import be made zero-rated

KARACHI - All Pakistan Fruit and Vegetable Exporters and Importers and Merchants Association have passed their suggestions regarding Budget Proposals 2008-2009. The following are main points of agenda, charted down by the members of the association. In trade policy 2004-2005 the government had announced the support for cold storage and cool chain infrastructure for horticulture products allowing the following incentives: "Mark up cost of loans obtained by exporting units for establishment of cool chain infrastructure will be picked by Export Promotion Bureau through the Export Development Fund (EDF) up to a maximum of 6%". It is requested that 6% ceiling should be increased to 12% to14%. "Export trade should move from volume to value based exports. Research and Development support at the rate of 6% to be given to exporters of fresh fruits and vegetables as is being given to textile sector. Horticulture Export should be declared as industry. Import of spares for fruit & vegetable processing machinery should be made zero rated either directly or under PHDEB recommendation. Duty free import of hybrid seeds, plants & rootstocks Tax holidays on local manufacturing of above machinery, equipment and materials. Duty free import of new and used (not older than 5 years) diesel/gasoline generator up to 20 KVA, including import under personal baggage, gift and transfer of residence scheme. 0.75% withholding tax should be charged on FOB instead of C&F.  There is no Research and Development support to horticulture export. This encourages business on ad-hoc basis.  Government should install strong RD support as fresh produce export has become highly competitive. Zero rated sales tax on electricity and gas to processing units of Kinnow and Mangoes which are 100% export oriented. Government should promote joint venture in fruit and vegetable processing (value added products) with buy-back arrangements.

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