Bangladesh has brought down source tax for export to 0.60 per cent. But this will not be applicable for jute and jute-made products. Also, corporate tax for readymade garment industry has been lowered to 12 per cent. In terms of corporate tax structure, the 2018-19 budget proposed a hike for garment factories. It proposed a flat 15 per cent tax for all factories and 12 per cent for those certified as green factories – up from 12 per cent and 10 per cent respectively. Now the previous structure has been brought back.

Last fiscal, the apparel industry of Bangladesh earned $30.61 billion, which is 83.5 per cent of total export receipts for the year. The source tax collected from export proceeds of garments is roughly the revenue collected as income tax from the apparel sector. The garment industry is the country's main export earner. It is looking to touch $50 billion in shipments by 2021.

Some garment exporters are said to import fabrics duty-free and sell them in the domestic market. Producers who make cloth for the domestic market say this hurts them. Leather goods and footwear manufacturers and exporters of Bangladesh have called for duty-free benefits for importing equipment to ensure fire safety at factories.