Leaders of the country's leading apparel sectors Wednesday demanded withdrawal of proposed 1.5 percent income tax at source on exportable goods and urged the government to fix it at 0.25 percent like that of 2009-2010 fiscal to help flourish the sector.
The leaders of BGMEA, BKMEA and BTMA at a joint press conference at Hotel Ruposhi Bangla said export-oriented garments and textile sectors are the worst affected in the proposed budget. They demanded 15 percent alternative cash incentive till 2015, immediate implementation of the announced stimulus package, export stimulus package for SME sector, 'new market' stimulus package, 10 percent rebate against electricity bill and withdrawal of 9 percent VAT on house rent.
The apparel export leaders urged the government to reduce furnace oil price and fix it at Tk 22 per liter and bringing RMG and textile sectors under the tax holiday facilities and continue it till 2015. BGMEA (Bangladesh Garments Manufacturers and Exporters Association) president M Shafiul Islam Mohiuddin read out a written statement at the press conference that contains their demands with explanations on behalf of the three bodies.
BKMEA (Bangladesh Knitwear Manufacturers and Exporters Association) president AKM Selim Osman, BTMA (Bangladesh Textile Mills Association) president Jahangir Alamin and other leaders were present. They said the proposed 1.5 percent income tax at source on exports will hamper usual flourish of the garment and textile sectors.
The market leaders said the RMG and textile sectors are facing increasing risk factors which are now 30 to 35 percent due to price hike of raw materials, high bank interest, workers' wages and increasing cost of doing business. "If the government imposes 1.5 percent tax at source, additional 25 percent risk factor would be added and we won't be able to sustain the competitive market," they said. The apparel leaders said there was 5 percent cash incentive support which could not help offset the current scenario in the textile sector and demanded 15 percent cash incentive for the next four years. They said the government-announced stimulus package remains unimplemented due to unknown reason and it should be implemented without any delay. The leaders said there was a commitment of the government to give 10 per cent rebate on electricity bills of SME industries with a condition that generator can not be used.
"We don't think there is any existence of industrial unit without generator." They observed that the imposed 9 percent VAT on house rent will be an additional burden for SME sector and demanded withdrawal of the VAT fully. The three top body leaders observed that there were no guidelines on how the pressure on economy like liquidity crisis and inflation can be addressed.  UNB