Plastic goods manufacturers and exporters on Sunday demanded the withdrawal of import duty, VAT, and supplementary duty on import of capital machinery and spare parts for the sector.
They also urged the government to exempt tax on import of raw materials for plastic toy manufacturers and impose duty on imported finished toys as part of protecting the local industry.
Besides, they demanded a cut in the corporate tax rate on the export-oriented plastic industry to 12 per cent from existing 35 per cent.
Another association of garment accessories and packaging industry also came up with a proposal for slashing corporate tax to 12 per cent from 32.50 per cent in the upcoming budget for FY 2021-2022.
The proposals were placed at a pre-budget meeting of the National Board of Revenue (NBR) with Bangladesh Plastic Goods Manufacturers & Exporters Association (BPGMEA) and Bangladesh Garments Accessories & Packaging Manufacturers & Exporters Association (BGAPMEA) at the NBR headquarters in the city’s Segunbagicha.
Presided over by NBR chairman Abu Hena Md Rahmatul Muneem, the programme was addressed, among others, by BPGMEA president Md Jashim Uddin, its former president Shamim Ahmed, advisor Manzur Ahmed, BGAPMEA president Md Abdul Kader Khan, its second vice-president Mozaharul Haque Shahid, and NBR member (tax policy) Md Alamgir Hossain.
The NBR chairman said the revenue authority would look into the proposals to facilitate local toy manufacturers as the government is always in favour of protecting the labour-intensive domestic industries.
“There is a policy to promote small and medium enterprises across the country to strengthen the rural economy.”
Referring that local garment accessories-manufacturers compete with China to sell products globally, Mr Muneem said, “The sector itself needs to work to increase competitiveness in the international market because only duty support can’t make an industry capable.”
He also assured the two associations of taking initiatives to resolve any inconsistency in laws with its implementation.
The BPGMEA president said despite being direct exporters and adding great value to the export-oriented RMG industry by delivering cent per cent accessories, the country’s plastic industry doesn’t enjoy facilities like BGMEA, BKMEA or BTMA.
“We want the corporate tax rate similar to the export-oriented RMG industry which is 12 per cent. Currently, plastic manufactures pay 35 per cent corporate tax.”
Referring to the potential of local toy manufacturing industry, Mr Jashim said with proper support, local toy industry can go for export after meeting the domestic demand.
The government should exempt tax on import of raw materials for the toy industry while tax should be increased on import of finished toys, he added.
Mr Shamim further said there have been allegations of massive under-invoicing in import of plastic toys.
BGAPMEA, however, demanded withdrawal of income tax on the purchase of raw materials from the domestic market through cash payment or back-to-back LC (letter of credit).
Seeking cash incentives facility, the BGAPMEA president said many export-oriented small and medium industries get cash incentives on export but the garment accessories and packaging industry has been deprived of it despite being an exporter and making contributions to the RMG sector.
Mr Khan also proposed cutting tax at source to 0.25 per cent from 0.50 per cent for direct and indirect exports of garment accessories and packaging products.
Source: Financial Express
