Country's clothing and textile sector has sought continuation of the government's policy support, including withdrawal of some taxes and duties for the next five financial years.
The government support is sought to help the export earning industry recover from the Covid-19 fallout.
The industry insiders said if the labour intensive sector fails to bounce back more than 4000 apparel and textile factories that have over 400,000 employees whose 80 percent are women, will leave a long term negative impact on the country’s overall economy.
Highly appreciating the government for extending support to the apparel sector, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Dr Rubana Huq said the clothing industry gets support from the government’s stimulus package of Tk 5,000 crore for paying the salary of garment workers.
“On behalf of the apparel industry, I would like to express our sincere thanks and gratitude to Prime Minister Sheikh Hasina for supporting us. The government’s financial assistance has helped the industry stay in business by paying salary to the workers,” she said while speaking at the pre-budget consultation with NBR recently.
Alongside the BGMEA, the leaders of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textiles Mills Association (BTMA) also placed their budget proposals at the same meeting.
The 16-point- proposal of BGMEs include withdrawal of tax on cash support, keeping intact the corporate tax rate for this sector for the next five years, removing the complexities arising from HS code , withdrawing duty on import of machinery for industries and simplifying the unloading process of capital machinery and other machinery.
Dr Rubana Huq said reduction of tax at source on RMG exports needs to be lowered to 0.25 percent from the existing 0.50 percent and keep this rate unchanged for the next five years.
The BGMEA President also proposed for simplifying the conditions for importing firefighting equipment to expand factories.
She said the RMG industry is still passing difficult time as factories are still struggling to turn around.
She also called for creating a block account for 10 years and relocated the liabilities in the interest free block account while keeping the single exposure limit unaffected.
Dr Rubana Huq also requested the government to allow five years to repay the loans disbursed by the government under a stimulus package to help the sector offset the economic fallout from the pandemic.
The leaders of BGMEA and BKMEA informed that the regular exporters are not involved with the misappropriation of the bond facilities, rather a vested quarter is involved in it.They also assured the revenue board of extending their cooperation for detecting those who are involved in such forgery.
First Vice-President of BKMEA Mohammad Hatem urged the NBR to take necessary measures so that the vested quarter could not do business in Bangladesh.
BTMA President Mohammad Ali Khokon demanded imposition of VAT at a same rate on all types of yarn, fixing the tariff value on import of fabric in line with the international market and using the weighing in terms of meter instead of kilogram (KG).
The textile millers also demanded withdrawal of a 5 percent advance tax on import of polyethylene terephthalate (PET) chips which are used to make yarn in the production of garment items.
They also demanded withdrawal of a 10 percent tax on 4 percent cash incentive provided against export receipts.