BGMEA urges NBR not to levy tax at source during recession
Thursday, 16 April 2009
FE Report
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Wednesday expressed its concern over foreign direct investment (FDI) in RMG sector, as the local industrialists might face stiff competition from the foreign investors.
"Foreign investors have expertise in marketing, production and networking and it is difficult for the local industrialists to outmanoeuvre them in these fields," said BGMEA president Salam Murshedy at a pre-budget meeting with National Board of Revenue (NBR) officials in the city.
The government should reduce discrimination between factories in export processing zones (EPZs) and outside EPZs, he said.
The BGMEA put forward a set of proposals to NBR to face the current global crisis.
"RMG order situation is deteriorating and the impact will be felt from April onwards," said Murshedy at the meeting.
The government figures show that export increased in January and February but the export orders were placed last year, he explained.
Salam urged the NBR not to levy duty on raw materials that exceeded the period of two and a half year in a bonded warehouse.
"In the recession period, it may not be possible for exporters to use all duty-free raw materials and only during this period the NBR should not charge any duty on the materials," he said.
He also urged the tax officials not to collect tax at source in the recession period and reduce the duty on capital machinery to zero percent from 1.0 per cent.
Acting chairman of NBR Dr Nasiruddin Ahmed said the tax office would mobilise resources and at the same time address the problems of the BGMEA.
"The main objective of the NBR is to collect revenue but we also acknowledge that BGMEA is a thrust sector and we will extend all-out support to the sector," he said.
It is expected that revenue from imports would fall in the coming months and the tax authority should focus on more revenue earnings from domestic sources - value added and income taxes, he explained.
RMG and other export-oriented sectors are facing problems due to recession and NBR would examine the BGMEA proposals, he assured the garment manufacturers.
BGMEA officials and senior NBR officials attended the meeting.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Wednesday expressed its concern over foreign direct investment (FDI) in RMG sector, as the local industrialists might face stiff competition from the foreign investors.
"Foreign investors have expertise in marketing, production and networking and it is difficult for the local industrialists to outmanoeuvre them in these fields," said BGMEA president Salam Murshedy at a pre-budget meeting with National Board of Revenue (NBR) officials in the city.
The government should reduce discrimination between factories in export processing zones (EPZs) and outside EPZs, he said.
The BGMEA put forward a set of proposals to NBR to face the current global crisis.
"RMG order situation is deteriorating and the impact will be felt from April onwards," said Murshedy at the meeting.
The government figures show that export increased in January and February but the export orders were placed last year, he explained.
Salam urged the NBR not to levy duty on raw materials that exceeded the period of two and a half year in a bonded warehouse.
"In the recession period, it may not be possible for exporters to use all duty-free raw materials and only during this period the NBR should not charge any duty on the materials," he said.
He also urged the tax officials not to collect tax at source in the recession period and reduce the duty on capital machinery to zero percent from 1.0 per cent.
Acting chairman of NBR Dr Nasiruddin Ahmed said the tax office would mobilise resources and at the same time address the problems of the BGMEA.
"The main objective of the NBR is to collect revenue but we also acknowledge that BGMEA is a thrust sector and we will extend all-out support to the sector," he said.
It is expected that revenue from imports would fall in the coming months and the tax authority should focus on more revenue earnings from domestic sources - value added and income taxes, he explained.
RMG and other export-oriented sectors are facing problems due to recession and NBR would examine the BGMEA proposals, he assured the garment manufacturers.
BGMEA officials and senior NBR officials attended the meeting.