Withdraw VAT, import duty on manmade fibre: BTMA

Textile millers yesterday demanded the withdrawal of value-added tax (VAT) and import duty on all kinds of manmade fibre for the potential growth of the non-cotton fashion industry to meet the global demand.

In the proposed budget, the government did not address this issue even though the entrepreneurs of the country's primary textile sector had been demanding this beforehand, the textile millers said at a post-budget press conference at the office of Bangladesh Textile Mills Association (BTMA).

The government should consider the request as the demand for manmade fibre garments is higher than the cotton-made fibre globally.

For instance, manmade fibre occupies 78 per cent of the global fashion industry and the rest 22 per cent by cotton fibre.

But in Bangladesh, the scenario is reversed.  Of the total garment export from Bangladesh in a year, 74 per cent is made from cotton fibre while 26 per cent from man-made fibre, they added.

"If we want to grab more of the global market share, we will have to choose the manmade fibre as the demand is rising for those garment items," said BTMA President Mohammad Ali Khokon.

The BTMA chief welcomed the proposed budget, but he wants some facilities for the textile sector for attracting further investment and for generating more employment.

Khokon also demanded that the government fix Tk 3 as VAT on sales per kilogramme (kg) of all kinds of yarn in the local markets.

Currently, the National Board of Revenue collects Tk 3 as VAT on the sales of per kg of yarn made from cotton and Tk 6 per kg on the sales of yarn made from manmade fibre.

So the VAT rate should be uniform for all kinds of yarn sale, he said.