The country's private jute millers have sought exemption from source tax on cash subsidy on their export earnings due to a downward trend in shipment of jute for years.
Bangladesh Jute Mills Association (BJMA) has recently made their demand for waiver of fiscal measures to the National Board of Revenue (NBR) and the Ministry of Textiles and Jute.
However, the government has increased source tax on cash subsidy to 10 per cent from 3.0 per cent with effective from the current fiscal year.
Jute millers said they have long been demanding for withdrawal of source tax on cash incentives. Instead of exempting them from paying tax, the authorities have increased it from this fiscal year, they added.
Jute goods exporters enjoy 12 per cent cash incentives on their export earnings.
When contacted, Abdul Barik Khan, secretary general of BJMA, said export earnings from jute goods dropped significantly in the fiscal year 2018-19 due to lower demand in the international market.
Exports of jute goods to Middle East and Africa also declined drastically in recent years. On the other hand, India has imposed anti-dumping duty, he added.
Although the authorities concerned assured them of providing required support, he said, they are yet to see any visible progress in this regard.
BJMA also demanded a cut in source tax on their export earrings from existing 0.60 per cent to 0.10 per cent. They sought special fund at a lower interest rate for development of the jute sector.
The Export Promotion Bureau (EPB) data showed that the sector earned US$ 816.27 million in the fiscal year (FY) 2018-19 while US$ 1.025 billion in FY 2017-18.
Export earnings from jute sacks and bags dropped by more than 32 per cent and jute yarn and twine by 20 per cent in the last fiscal year compared to that of the previous fiscal, statistics also showed.
Bangladesh exports jute goods to 135 countries including China, Turkey, India, Sudan and Zimbabwe.
The country produces about 7.0-8.0 million bales of raw jute each year. Nearly 40 million people are involved with this sector.
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