Keep tax unchanged at 0.25%: BGMEA, BKMEA

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The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) recently demanded that the government continue with the existing reduced rate of 0.25 per cent source tax and 10-12 per cent corporate tax for the next five years so that the sector turns competitive. Both the associations presented their budget proposals to the National Board of Revenue highlighting steps needed for the sector to fight the negative impact of the COVID-19 pandemic.

BGMEA, which submitted 12 proposals, said Bangladesh’s export witnessed a 6.21 per cent fall in growth in the July-December period of fiscal 2019-20 while its competitors Vietnam and Pakistan grew by 5.85 per cent and 5.25 per cent respectively in the same period.

The association said that it would be difficult for the industry to remain competitive on the global market due to the rising cost of doing business in Bangladesh, according to Bangla media reports.

It demanded duty-free imports of industrial racking system, industrial thermostat dehumidifier and other safety equipment. BKMEA demanded a 10 per cent cash incentive for using local raw materials and 4 per cent cash incentive for using imported ones for the next two years.

Thetrade body also proposed that the government should provide an exit plan for entrepreneurs in the upcoming budget with a special allocation as a good number of factories would be shut down in the next 12 months.