Retain 0.25% source tax for export industry: EAB
The EAB also asked that fire safety equipment be given an import discount
Exporters' Association of Bangladesh (EAB) president Abdus Salam Murshedy requested the finance minister retain the 0.25 percent source tax for the export industry considering the difficult time for the industry.
On behalf of the EAB, Salam Murshedy expressed his gratitude to the prime minister and the finance minister saying that the proposed budget reflects efforts to revitalise the country's overall economic activities and keep the economic activities moving, dynamic and intact, reads a press release.
He added the budget reflects the special emphasis on: social security, infrastructure, socio-economic, poverty alleviation, human resources, education, health, agriculture, disaster management, and information technology.
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Also, the budget has allocated funds to the health and research sectors for the first time, which is realistic. The association also applauded the prime minister and finance minister for setting the inflation at 5.4 percent.
He said there is no direction in the budget regarding the submission of VAT returns and an exemption of export-oriented industries from all types of VAT. He requested the provision of zero return for all the export-oriented industries be repealed before the budget is passed.
He expressed his gratitude to the finance minister for keeping the corporate tax rate for knitwear and woven garments, including the export-oriented garment industry, at 10 percent – factories other than green ones at 12 percent.
Talking about utilising artificial intelligence, he drew the attention of the government to establishing a Bangladeshi clothing brand in the West through the online platform called Bituci Platform – which will reduce Bangladesh's dependence on buyers.
In the case of import of capital equipment of export-oriented garment industry, in the current budget proposal, SROs have to be issued with certificates from the VAT officer's office, which will further complicate the import and export processes. He requested the government amend the relevant SROs for unloading of goods based on certificates issued by the Bangladesh Garment Manufacturers and Exporters Association plus Bangladesh Knitwear Manufacturers and Exporters Association.
The budget has reduced tax on yarn, exempted personal protective equipment and mask production from paying VAT, maintained zero percent duty on cotton imports and provided concessions on RFID Tag, Industrial Racking System, Cutting Table imports, which will help the industry, he said.
To help the export-oriented industries to cope with this push in the aftermath of Covid-19, the EAB has requested the withholding tax at the rate of five percent on the ongoing export cash subsidy in the proposed budget be waived.
The EAB asked that all fire safety equipment be given an import discount.
Due to Covid-19 outbreak, many factories will close in the next year and many entrepreneurs will be lost. Murshedi urged the government to allocate money for them in this year's budget for their safe departures.
