RMG makers seek cash incentive on repatriation of export earnings
Bangladesh Garment Manufacturers and Exporters Association, Bangladesh Knitwear Manufacturers and Exporters Association, Bangladesh Textile Mills Association and Exporters Association of Bangladesh made this demand at a joint letter to the finance ministry on Monday.
Readymade garments exporters have sought 4 percent cash incentives from the government against their repatriation of export proceeds, instead of value addition.
The country's apparel manufacturers have also urged the government to issue a master circular on the cash incentive as exporters were being harassed due to the ambiguity in the existing FE circulars in this regard.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Bangladesh Textile Mills Association (BTMA) and Exporters Association of Bangladesh (EAB) made this demand at a joint letter to the finance ministry on Monday.
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BGMEA President Rubana Huq, BKMEA President AKM Salim Osman, BTMA President Mohammad Ali Khokon and EAB President Abdus Salam Murshedy signed the letter.
Currently, apparel exporters are enjoying 4 percent alternative cash incentive against value addition to their knitwear products produced in the country.
But apparel exporters claimed that currently the cash incentive is being calculated on 80 percent of their repatriated export proceeds, which means they are getting the highest 3.2 percent.
In the letter, the trade bodies said that all other export sectors in the country are getting cash incentive against their repatriation of export proceeds while the incentive for the apparel sector is calculated on value addition which is 80 percent of its repatriation.
They claimed that the calculation of cash incentive on value addition made the process cumbersome.
The trade bodies said that the Bangladesh Bank issued a number of circulars several times in this regard and all the circulars created new ambiguity by using complex words.
The exporters said that cash incentives could be given against freight onboard instead of value addition as there was no realistic methodology for determining value addition to products.
"Different methodology is used in determining products prices based on the variation of design and quality of fabric. And the issue is very much technical as the charges for knitting and dying are variable," read the letter.
