The All Pakistan Textile Mills Association (APTMA) has rejected the Punjab Infrastructure Development Cess after the Governor signed the levy into law, warning on Sunday that the 0.90% charge on goods manufactured, imported, and exported through Punjab will accelerate deindustrialization, discourage investment, and cost jobs across the province.
What is the Punjab Infrastructure Development Cess and why does APTMA oppose it?
The Punjab Infrastructure Development Cess imposes a 0.90% levy on goods at multiple stages, covering production, consumption, imports into Punjab, and exports out of the province. APTMA opposes it because Punjab-based manufacturers already pay the Sindh Infrastructure Cess on consignments passing through that province, meaning the new law creates a double taxation burden that Sindh-based competitors do not face.
How will the cess affect Punjab's competitiveness against other provinces?
Punjab's manufacturing sector is already under pressure from high energy costs, a heavy taxation burden, and a difficult operating environment. APTMA warned that adding another provincial levy will widen the cost gap between Punjab-based industry and manufacturers in Sindh, Khyber Pakhtunkhwa, and the erstwhile FATA regions. That disadvantage, the association said, will discourage new investment and push existing businesses to relocate.
For the export-oriented textile sector, the consequences are direct. International buyers set prices based on global competition, so additional levies cannot be passed on to customers. The cess will instead be absorbed by manufacturers, eroding the margins of exports originating from or passing through Punjab.
What enforcement concerns has APTMA raised about the cess?
The broad scope of the legislation grants cess officers powers to establish check posts and carry out physical inspections of goods in transit. APTMA warned this will create bottlenecks, delays, and harassment in the movement of goods, raising transaction costs and disrupting supply chains across Punjab.
The association said such administrative burdens are inconsistent with Pakistan's stated goals of expanding exports and reviving industrial activity. The textile sector is among the country's largest employers and a major source of foreign exchange, and further erosion of its competitiveness will have consequences for investment, output, and employment.
What has APTMA called on the Punjab government to do?
APTMA has called on the Government of Punjab to immediately recall the Punjab Infrastructure Development Cess and open meaningful consultations with industry stakeholders. The association warned that failure to withdraw the levy will accelerate deindustrialization, lead to the closure of industrial units, and push unemployment higher across the province.
APTMA Chairman Kamran Arshad has written directly to Punjab Chief Minister Maryam Nawaz Sharif, stating that the bill has triggered distress across the province's industrial base at a moment when policy should focus on cutting production costs rather than adding new levies.
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