The Bangladesh Textile Mills Association (BTMA) recently requested the government to raise alternative cash incentives from 4 per cent to 7 per cent for the upcoming fiscal to fight the economic fallout of the COVID-19 pandemic. The association also called for reducing source tax to 0.25 per cent from the existing 0.50 per cent for the next fiscal.
The association placed a set of demands before the National Board of Revenue (NBR) for its consideration ahead of the national budget in June to help the textile sector recover from the pandemic.The Bangladesh Textile Mills Association (BTMA) recently requested the government to raise alternative cash incentives from 4 per cent to 7 per cent for the upcoming fiscal to fight the economic fallout of the COVID-19 pandemic. The association also called for reducing source tax to 0.25 per cent from the existing 0.50 per cent for the next fiscal.#
In consideration of the devastating impact of pandemic, a 4 per cent alternative cash incentives is not enough for the sector, according to BTMA.
After the country graduates from the least developed country (LDC) status, there will be new challenges for the sector due to erosion of duty benefits enjoyed as an LDC nation.
In fiscal 2018-19, the tax at source was set at 0.25 per cent and it was affordable. But in fiscal 2019-20, it was increased to 0.50 per cent.
Export earnings from the apparel sector have witnessed a negative growth due to the pandemic, which also hit the backward linkage industry badly, BTMA said.
The textile millers also demanded withdrawal of 2 per cent tax on purchase of cotton from domestic sources and withdrawal of 5 per cent advance import tax on pet chips as it will increase the prices of yarn, according to Bangla media reports.
The government was also urged to remove 5 per cent value-added tax (VAT) on all kinds of fabrics made of man-made fibres at the production level. They also called for setting Tk 3 as VAT per yard on all kinds of yarn made of any kind of fibre. They have to pay Tk 4 per yard at present.
Fibre2Fashion News Desk (DS)
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