Budget leaves BTMA unhappy

The budget proposals will hamper the country's textile industry or deemed exporters, said Bangladesh Textile Mills Association (BTMA).

Though the sector demanded that import tariff of yarn or fabrics be reset and VAT on non-cotton yarn or fabrics be reduced to the level of cotton yarn, the budget has no reflection of that, it said.

The demand for removal of the mandatory provision to get a licence from the Customs Bond Commissionerate under the National Board of Revenue to sell textile products to local exporters through back-to-back LCs has also been ignored, the association said.

In domestic sales, yarn is not sold in the black market, said BTMA President Mohammad Ali Khokon at a press briefing at the BTMA office on Sunday in the capital's Panthapath.

Entrepreneurs think the provision has been made stricter in the new budget and that will push up the cost of business undermining the efforts to ensure ease of doing business.

The mandatory provision is in conflict with the government's target to help local industries flourish, Khokon said. 

He demanded that tariff on commercial imports of yarn and fabrics be reset at $10 from $3 a kg, source tax on exports of finished garments be halved and the existing advance tax be removed on importing yarn and fabrics from man-made fibres. 

The demand for garments made out of artificial fibre has been growing globally but Bangladesh occupies a very small share of the market.

According to the association, 3 lakh tonnes of yarn and fabrics from man-made fibre was imported last year, and local textile factories supplied another 1 lakh tonne.

Manufacturing of such products should be inspired for export diversification, but that has not been taken into consideration in the budget, the BTMA said.