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Bangladesh RMG makers want 0.70 per cent tax at source as final settlement

Bangladesh’s apparel sector have urged the government to fix 0.70 per cent tax at source on export as a final settlement instead of making it just a minimum rate. The call came from Bangladesh Garment Manufacturers and Exporters Association (BGMEA) in a letter to the Finance Minister AMA Muhith. BGMEA President Siddiqur Rahman has said the rate was earlier reduced to 0.70 per cent from 1.50 per cent in the proposed budget.

The letter says that although the budget for the FY16-17 proposed to set tax at source on export to 1.5 per cent for apparel exporters, the rate was later reduced to 0.70 per cent following the intervention. If the tax at source of 0.70 per cent is considered as minimum tax, there are possibilities of imposing other higher taxes and there are also possibilities of harassment to entrepreneurs which will make the income tax return submission process more complex, it added.

Urging the Finance Minister to intervene in the matter, the BGMEA President also requested him for giving necessary instructions to the National Board of Revenue (NBR) for amending the income tax ordinance and issue necessary diktats to consider tax at source on export for the apparel makers as final settlement which the RMG makers enjoyed before. So far the apparel makers have enjoyed tax at source on export as final settlement. However, the FY17 budget turned 0.70 per cent tax at source on export as minimum tax. During the last fiscal year, the readymade garment (RMG) makers were enjoying 0.60 per cent tax at source on export which was considered as final settlement.

 
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