Give zero-duty benefit to all sectors for import of fire safety equipment

The government offers duty privileges to only garment and textile sectors on import of fire safety equipment, ignoring the fact that ensuring protection from fire is also necessary for other industrial sectors.

The issue came to the fore yesterday at a pre-budget discussion at the National Board of Revenue headquarters, where exporters, including garment manufacturers, urged the authorities to provide zero-duty benefit to other industrial sectors for import of fire safety equipment.

The NBR now allows garment makers and textile millers to import certain fire safety gears such as fire-resistant doors, sprinkler system and equipment, and emergency light with exit sign and double heads at 5 percent customs duty. For all other industries, the import duty on the gears is 60 percent.

“There should not be any tax on import of fire safety equipment for any sector,” said Md Siddiqur Rahman, president of Bangladesh Garment Manufacturers and Exporters Association. The extent of losses from fire incidents, in the form of lost lives and damaged property, is much higher than the amount of revenue that would come from the imposition, he said.

Rahman said there are risks of fire at any place in the event of earthquake. “So, we want the government to offer the benefit to all,” he added.

Early this month, the Metropolitan Chamber of Commerce and Industry, at a pre-budget discussion at its office, also raised the issue of high import duty on fire safety equipment and demanded even treatment for all industries.

The MCCI said safety and compliance is extremely important for all industries.

“Such discriminatory behaviour must be stopped if we want the other sectors to also flourish in our economy. We hope that the budget will reflect this,” MCCI President Syed Nasim Manzur had said in the meeting, which was attended by Finance Minister AMA Muhith.

The MCCI also wrote to the revenue authority earlier this year to extend duty exemption for fire safety equipment to other sectors as well.

The issue of compliance in the backward linkage industries of the garment sector is also important, said Rafez Alam Chowdhury, a former president of the Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association.

“So those industries also need the duty benefit,” he added.

At the yesterday's discussion, apparel exporters also demanded a reduced corporate tax rate of 10 percent for the sector.

The BGMEA said garment exporters enjoyed 10 percent corporate tax until June 30, 2014, after which they had to pay 35 percent.

The BGMEA president said the reduced corporate tax rate will facilitate investment, which will be instrumental in achieving the $50 billion export target by 2021.

“Please give us the breathing space this time,” he said.

Garment exporters also demanded a slash in tax at source to 0.30 percent from present 0.60 percent.

At the discussion, NBR Chairman Md Nojibur Rahman said the revenue authority has detected misuse of the bonded warehouse privilege.

“We will sit with you to discuss the contribution of your members to the national coffer,” he said, adding that the NBR would also take steps to solve the sector's tax-related problems if there are any.