BKMEA for continuation of current corporate tax rate for 5 more years

The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) today urged the government to cut the tax deducted at source and continue the existing corporate tax rate for another five years.

The association's Executive President Mohammad Hatem placed the proposals during a meeting with the National Board of Revenue (NBR) at the latter's headquarters in the capital's Agargaon.

According to one of the proposals, the tax deducted at source should be slashed to 0.5 per cent from 1 per cent in 2023-24 for export-oriented garment factories. The reduced rate should be continued for five years.

The government should continue the 12 per cent corporate tax for garment industries and 10 per cent for green garment factories for the five fiscal years.

The same rate should be applicable while assessing other incomes and disallowable expenses, it said.

The BKMEA called for 2 per cent, 3 per cent, and 4 per cent income tax rebate if workers with disability account for 1 per cent, 2 per cent, and 3 per cent of the total workforce of a factory, respectively.

The association said 100 per cent value-added tax exemption should be provided to the services and products involved in the manufacturing and exporting of export-oriented goods. 

The BKMEA called for scrapping of the provision that says exporters and deemed exporters must have bonded warehouse facilities if they want to qualify for opening back-to-back letters of credit. 

A back-to-back LC involves two letters of credit to secure financing for a single transaction. It is used primarily in international transactions.

The association demanded the removal of all duties imposed on the imports of solar panels and solar inverters with a capacity of more than 10 kilowatts, with a view to popularising renewable energies.

It recommended zero duty and VAT on the import of chemicals needed to set up effluent treatment plants.