Seven export sectors to get tax benefits
Thursday, 6 August 2009
Doulot Akter Mala
Seven major export sectors will be exempted from scrutiny of taxmen on their export earnings and the government will treat the payment of tax in advance as final settlement.
The sectors include Terri towel, carton and accessories of garment industry, jute goods, frozen foods, leather goods and processed foods.
Taxmen will not be asked any question on the amount earned from export of products of those sectors after payment of advance tax at 0.25 per cent, which was earlier subject to scrutiny at the time of assessment of income, a senior tax official said.
The revenue board has also waived 5.0 per cent tax on cash subsidy that the exporters receive against export of products.
From the current fiscal, the NBR will not slash any tax from cash subsidy.
The National Board of Revenue (NBR) has incorporated those measures in the current fiscal year through issuing a circular.
"There will be no assessment on the export earning of those seven exporting sectors from fiscal 2009-2010 after deduction of tax at source," the tax official said.
Currently, the exporters get refund of the tax that was slashed at source on export-earning. But they have to furnish all detailed information about the income in the tax return for assessment to get tax credit.
During the last few years, the facility was only valid for knitwear and woven garments. Other exporting sectors have long been demanding the tax measure to avoid unusual hassle at the time of assessment of the income.
"The NBR has made the change to remove complexities in refunding income tax that often creates disagreement among the exporters and taxmen," said the official.
"We have also withdrawn the 5.0 per cent tax that the government earlier cut as advance tax from cash subsidy," the official said.
The NBR has waived the taxes in the backdrop of exporters' demand although it will affect the revenue earning, he added.
Around 14 major exporting sectors have been enjoying the fund support from the government to stay competitive in the international market.
Bangladesh Chamber of Industries (BCI) president Shahedul Islam Helal said: "Exporters have long been demanding waivers of tax on cash subsidy and treat tax at source as final settlement."
Getting refund or claiming tax credit from national exchequer is a complicated procedure as taxmen assess the income at the time of tax return submission, he said.
Hailing the NBR's decision on tax waiver from cash subsidy, Helal said: "Cutting tax from cash subsidy was an irrational measure as the government provides the fund support to help the exporters."
Bangladesh Corrugated Carton and Accessories Manufacturers and Exporters Association president Safiullah Chowdhury said: "The measure will reduce unusual hassle and harassment of the exporters in the tax office."
The proposal of the exporters was approved in parliament after budget, he added.
Bangladesh Finished Leather, Leather Goods and Footwear Exporters' association president Rezaul Karim Ansary said: "We prefer deduction of taxes at sources to avoid tax related hassle in future."
On waiver of tax from cash incentives, he said: "It will strengthen cash flow to exporters as they will get the full benefit of incentives offered by government."
Seven major export sectors will be exempted from scrutiny of taxmen on their export earnings and the government will treat the payment of tax in advance as final settlement.
The sectors include Terri towel, carton and accessories of garment industry, jute goods, frozen foods, leather goods and processed foods.
Taxmen will not be asked any question on the amount earned from export of products of those sectors after payment of advance tax at 0.25 per cent, which was earlier subject to scrutiny at the time of assessment of income, a senior tax official said.
The revenue board has also waived 5.0 per cent tax on cash subsidy that the exporters receive against export of products.
From the current fiscal, the NBR will not slash any tax from cash subsidy.
The National Board of Revenue (NBR) has incorporated those measures in the current fiscal year through issuing a circular.
"There will be no assessment on the export earning of those seven exporting sectors from fiscal 2009-2010 after deduction of tax at source," the tax official said.
Currently, the exporters get refund of the tax that was slashed at source on export-earning. But they have to furnish all detailed information about the income in the tax return for assessment to get tax credit.
During the last few years, the facility was only valid for knitwear and woven garments. Other exporting sectors have long been demanding the tax measure to avoid unusual hassle at the time of assessment of the income.
"The NBR has made the change to remove complexities in refunding income tax that often creates disagreement among the exporters and taxmen," said the official.
"We have also withdrawn the 5.0 per cent tax that the government earlier cut as advance tax from cash subsidy," the official said.
The NBR has waived the taxes in the backdrop of exporters' demand although it will affect the revenue earning, he added.
Around 14 major exporting sectors have been enjoying the fund support from the government to stay competitive in the international market.
Bangladesh Chamber of Industries (BCI) president Shahedul Islam Helal said: "Exporters have long been demanding waivers of tax on cash subsidy and treat tax at source as final settlement."
Getting refund or claiming tax credit from national exchequer is a complicated procedure as taxmen assess the income at the time of tax return submission, he said.
Hailing the NBR's decision on tax waiver from cash subsidy, Helal said: "Cutting tax from cash subsidy was an irrational measure as the government provides the fund support to help the exporters."
Bangladesh Corrugated Carton and Accessories Manufacturers and Exporters Association president Safiullah Chowdhury said: "The measure will reduce unusual hassle and harassment of the exporters in the tax office."
The proposal of the exporters was approved in parliament after budget, he added.
Bangladesh Finished Leather, Leather Goods and Footwear Exporters' association president Rezaul Karim Ansary said: "We prefer deduction of taxes at sources to avoid tax related hassle in future."
On waiver of tax from cash incentives, he said: "It will strengthen cash flow to exporters as they will get the full benefit of incentives offered by government."