Exporters’ demands not reflected in the proposed budget
The country's exporters have expressed their disappointment with the proposed budget for the upcoming 2023-24 fiscal year, as it does not address their demands for additional benefits for the sector.
Against the backdrop of the Russia-Ukraine war and global economic crisis, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and other exporters' organisations have called for a reduction in the source tax on exports from 1% to 0.50%.
However, despite their appeal, the proposed budget does not include any reduction in this tax.
The source tax on exports was increased from 0.50% to 1% in the budget of 2022-23 FY.
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On the other hand, there was a proposal to lower or withdraw the current import duty on various machinery used in the production of readymade garments. But, the proposed budget does not reflect these demands.
Besides, they also demanded the withdrawal of the source tax of 10% on the incentives received by the exporters from the government.
Moreover, to encourage the man made fibre-based industry in the garment sector, duty-free facilities were sought for the import of raw materials and some related machinery.
Exporters claimed that none of these demands have been reflected in the proposed budget.
"We are disappointed with the budget," said Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).
He said, "Given the current circumstances, we are not generating profits but experiencing significant losses. Under such conditions, imposing a 1% source tax on us is unjust."
"Additionally, the proposed budget fails to address our other reasonable demands, such as the matter concerning manmade fibre," he added.
As per the Export Promotion Bureau of Bangladesh, the country's export revenue has decreased in March and April of this fiscal year compared to the corresponding period of the previous financial year.
Exporters have attributed this situation primarily to the decline in global demand resulting from the ongoing Russia-Ukraine war. Given the circumstances, they express concerns that the downward trend in exports may persist in the upcoming months as well.
