The National Board of Revenue (NBR) has withdrawn the excise duty on raw materials used in the ready-made garments (RMG) sector, including cotton, synthetic fibers, and acrylic. According to a notification issued on July 17, these imported materials will now attract zero percent excise duty. Previously, there was a 2% advance income tax on cotton imports, which had been criticized by industry stakeholders.

The textile sector supplies approximately 70% of the yarn and fabric used in the RMG industry, which has investments worth nearly $23 billion. This decision is expected to provide some relief to the sector, which plays a crucial role in the country’s economy.