The country's garment accessories and packaging makers on Thursday expressed dissatisfaction over some measures proposed in the national budget for fiscal year 2024-25, saying that these would increase the cost of production.
The measures would lead many factories towards a severe crisis, resulting in closure of the units and unemployment, they said, urging the government to review some of the proposals to ensure a business-friendly environment.
Speaking at a press conference, Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) president Md Shahriar pointed out that though the proposed budget spoke about protection of local industries, it actually cut many of the facilities.
BGAPMEA former presidents Rafez Alam Chowdhury and Abdul Kader Khan, among others, were also present at the post-budget press conference at a city hotel.
Mr Shahriar said the budget proposed to increase duty on prefabricated building materials to 10 per cent from existing five per cent, VAT on energy-saving electric bulbs to 15 per cent from 5.0 per cent and to raise penalty ranging from 200 per cent to 400 per cent for HS code related mistakes.
Besides, the government decided not to provide new gas connections and bank loans to factories located outside the economic zones, he explained.
"If implemented, these will raise the cost of production," Mr Shahriar noted, demanding withdrawal of those measures.
The BGAPMEA president also demanded withdrawal of the proposed Tk 0.1 million new bond licence fee and renewal fee of Tk 10,000 annually from existing Tk 50,000 and Tk 5,000 respectively.
He also urged the government to fix source tax at 0.5per cent for five years with a final settlement.
Some 2,000 accessories and packaging makers have invested Tk 400 billion in the backward linkage industry that not only supplies accessories and packaging goods to readymade garment industry but also to pharmaceutical, frozen food, food and other industries, Mr Shahriar said.
The sub-sector earns US$8.0 billion by supplying goods to local RMG exporters, he said, placing 13-point demands, including withdrawal of 200 per cent to 400 per cent proposed penalty for HS code related mistakes.
The other demands included implementation of the decision of issuing Utilisation Declaration by BGAPMEA, cash incentive for deemed exporters, and reduced rate of import duty on capital machinery, construction materials and fire safety equipment.
Mr Rafez Alam Chowdhury said that US$15 billion worth of accessories and other materials would be required by the local export-oriented garment industry to achieve its US$100 billion export earnings target by 2030.
Policy support is needed to achieve the target, he noted.
The association leaders also criticised the measure proposed to whiten 'undisclosed and black' money at 15 per cent tax while the tax rate has been raised to 30 per cent for the regular tax payers.
They, however, appreciated proposals for reduction in corporate tax rate for companies owned by individuals, halved the tax rate for many essential items to curb inflation and enhanced allocations for social safety net and education.
munni_fe@yahoo.com