Footwear makers demand VAT exemption to save industry

Bangladesh Paduka Prostutkarak Samity (BPPS) has urged the interim government to reinstate an exemption from value-added tax (VAT) to protect the industry from lagging in competition.

Addressing a press conference at the Dhaka Reporters' Unity today, the footwear association's Vice-President Ashraf Uddin said, "Our industry will lag behind more in competition due to the imposition of VAT."

"We want exemption from VAT for sandal worth up to Tk150 and necessary steps to sustain small and medium entrepreneurs like us," he said.

BPPS believes that with the country experiencing high inflation for more than two years, collecting 15% VAT from consumers is impossible, he said.

He further said, "Product prices cannot simply be increased at will. But service costs nearly doubled during the previous government's tenure, and workers' wages have also risen."

"On top of that, the prices of daily essential food items have surged. Due to high inflation, business activity has declined by 30-40%. In this situation, an increase in VAT will further deteriorate the scenario," he said.

Ashraf Uddin said, "This product was exempt from VAT. Even the recycled plastic granules used in production are not subject to VAT. So, for what reason should VAT be imposed on this product? Moreover, rubber and plastic sandals are produced through recycling, which plays a supportive role in preventing environmental pollution."

"I'm urging the government to put special consideration into uplifting the living conditions of poor people. Also, we urge continuation of the eco-friendly recycling programme," he said.

He added, "It is our collective responsibility to protect local industries and ensure affordable products for the poor. Therefore, we hope that the government will take prompt action and exempt VAT to alleviate public suffering."

Earlier, the government raised the value-added tax and supplementary duty on over 100 products and services, including fruits, juices, beverages, tobacco products, restaurants, mobile talk time, and internet packages.