Leaders from Bangladesh’s apparel and textile sectors on Saturday demanded a reduction in the tax at source from 1 per cent to 0.50 per cent for export-oriented sectors and emphasized the importance of maintaining duty-free import of capital machinery for investors in economic zones.

During a press briefing on the proposed budget for the financial year 2024-25, sector leaders said that their proposals, including reducing export tax to 0.50 per cent, lowering tax on export retention quota to 10 per cent from 20 per cent, and providing tax waivers on fire safety equipment imports, were not incorporated into the budget.

Finance Minister Abul Hassan Mahmood Ali presented the proposed budget at the Jatiya Sangsad on June 6.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA) jointly organized the briefing at the BGMEA complex in Uttara, Dhaka.

SM Mannan Kochi, President of BGMEA, highlighted the challenges faced by the apparel and textile sectors due to global consumption declines and falling product prices.

Kochi emphasized the necessity of policy support to maintain export competitiveness and urged for a five-year reduction in export tax to 0.50 per cent, suggesting it as a final settlement for garment exporters.

He further called for the withdrawal of the proposed 1 per cent tax on capital machinery imports for companies in economic zones, citing its deterrent effect on investments and job creation.

He urged for the retention of current cash incentives until an alternative program is introduced and proposed a special fund allocation in the budget to provide subsidized essential commodities for workers, aiming to sustain the manufacturing sector and the overall economy.

Mohammad Ali Khokon, President of BTMA, demanded the removal of value-added tax on textile waste collection and recycled fiber supply, in response to global buyer demands for eco-friendly products.

Mohammad Hatem, Executive President of BKMEA, warned of an impending crisis if the industry’s proposals are overlooked and called for a mechanism to adjust advance income tax, arguing against taxing unprofitable companies.

The briefing also saw the presence of BGMEA’s First Vice-President Syed Nazrul Islam, Senior Vice-President Khandoker Rafiqul Islam, Vice-President Abdullah Hil Rakib and directors Asif Ashraf, Shovon Islam, Md Ashikur Rahman Tuhin and Nusrat Bari Asha, among others.