Karachi (Masood Ahmed Siddiqui): Fruit and vegetable exporters have demanded the federal government restore the fixed tax system to assist farmers and ensure food security in the country.
Waheed Ahmed, the Patron-in-Chief of the Pakistan Fruit and Vegetable Exporters, Importers, and Merchants Association (PFVA), has written a letter to Prime Minister Shehbaz Sharif. This letter was written following a meeting with exporters in Karachi earlier this month, in which issues faced by fruit and vegetable exporters and solutions to increase exports were discussed. In his letter to Prime Minister Shehbaz Sharif, Waheed Ahmed pointed out that the supply chain for fruits and vegetables is highly unorganized, and exporters purchase these goods from third parties who typically do not have bank accounts. Additionally, most small farmers with up to 25 acres of agricultural land also do not have bank accounts. As a result, exporters have to make payments to farmers in cash or checks, which the farmers either cash themselves or pass on to others for payment. Furthermore, thousands of contract and seasonal laborers involved in packing export shipments of kinnow, mango, onion, and potato are also paid in cash. In this situation, it becomes impossible for exporters to provide detailed financial records when submitting income tax returns. Therefore, the PFVA has proposed that the new “advance tax” be abolished and that the fixed tax system be continued to support the export sector.
He stated that there is an urgent need for research and development (R&D), but it has been completely ignored in the budget. Pakistan’s kinnow exports have significantly declined from $220 million to $110 million. Substantial funds are required to develop new varieties such as seedless kinnow, improve quality, and increase per-acre yield. Waheed Ahmed mentioned that climate change is emerging as a major challenge and has already affected the production (per acre) of kinnow and mango, potentially making food security a national issue in the near future if serious efforts are not made now. As a result, farmers will not receive good compensation for their efforts, which could lead to a loss of interest in cultivating fruits and vegetables, thereby exacerbating food security issues. Therefore, he requested that some funds be allocated in the budget for climate change. China has made remarkable progress in agricultural development, and Pakistan should benefit from Chinese expertise in the agricultural sector to increase exports.
Waheed Ahmed informed that the fruit and vegetable sector has shown good progress by increasing exports and is expected to multiply the current export volume significantly, provided that the government restores the fixed tax system for the export sector and allocates adequate funds for R&D. He warned that if the suggestions given by exporters are not taken seriously and immediate action is not initiated, the exports of this sector could see a significant decline. The PFVA has urged the Prime Minister to prioritize these issues and initiate necessary actions for the future development of a sector with tremendous export potential.
