KARACHI - Importers of used clothes, on Tuesday, demanded withdrawal of the recently imposed sales tax which, they said, had taken even the secondhand clothes beyond reach of the poor. "We wish to draw attention of our government to withdraw sales tax, on this item, by issuance of a fresh SRO," Pakistan Secondhand Clothing Merchant Association (PSCMA) President Salim Vakani told a briefing at Karachi Press Club.
He said the used clothes were presently being imported into the country under PCT head 6309.0000, at a nominal customs duty of five percent and one percent income tax. Being used by the poor class and thus classified as zero-rated, the used clothes were previously exempted from the sales tax, but the government through SRO No.231 (1)/2011 withdrew the sales tax exemption on March 15.
"We are now informed that a sales tax of 17 percent, plus two percent, would have to be paid on import of the used clothes," Vakani said. Besides, he said, the importers would have to pay a withholding income tax of five percent against one percent allowed vide SRO 638(1)/2005. "This aggregates to an increase of 23 percent on the used clothes," he said, adding that used clothing was basically an item used by the poor, unable to buy a new article of any kind of apparel.