BGAPMEA seeks 0.5% source tax for 5 yrs

The Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) has urged the government to set source tax at 0.5 per cent from 1 per cent for the next five fiscal years.

The organisation also demanded to cancel bond facility for import of accessories already being produced by local manufacturers and available in the local market.

The apex body’s acting president AKM Mostafa Selim raised the demand in a press statement on the proposed budget for fiscal year 2023-24 on Saturday.

In the budget reaction, the BGAPMEA placed a four-point demand to the government regarding the sector’s growth. The demands are to set source tax at 0.5 per cent from 1 per cent for five fiscal years; to set up high technology-based garment accessories factories through government support; to ensure bonded facility for the accessories and packaging sector like the RMG sector; and to cancel bond facility on import of accessories that are manufactured locally.

The BGAPMEA also congratulated the proposed budget as it assured cash incentive for deemed exporters, which was one of their major demands for the last three decades.

“It would be better if the budget had specific direction to bring momentum in various businesses amid the ongoing global economic crisis,” the press release said.

The RMG backward linkage trade body claimed that due to the availability of accessories in the domestic market, the apparel sector is able to reduce lead time, and contribute 83 per cent to the country’s total export.

Though the government’s industry policy, export policy and textile policy mention equal facility to the accessories sector, it is yet to be implemented. The BGAPMEA urged the government to execute the policies for the accessories sector soon.

According to the BGAPMEA, they are now manufacturing almost all garment accessories and meeting nearly 95 per cent demands for the country’s apparel sector. Besides, the country’s accessories manufacturers are also directly exporting their goods.

BGAPMEA Director and Indet Group Managing Director Al Sahriar Ahmed told The Business Post, “If the government provides cash incentive to our sector, we will be more competitive in the global market, and the accessories sector could earn billions of dollars directly in a short time.”

He said, “We are contributing nearly $8 billion annually to the total RMG sector but we do not get any incentives against this, though the export policy directs to facilitate all exporters. We thank the finance minister for announcing incentive for deemed exporters, and we believe that the facility will be introduced as soon as possible.”