Govt to slash source tax on RMG exports

Dhaka,  Mon,  21 August 2017
Published : 13 Jul 2017, 00:55:46 | Updated : 13 Jul 2017, 09:24:34
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Govt to slash source tax on RMG exports

NBR may issue SRO soon
Govt to slash source tax on RMG exports
FE Report
The government is going to reduce the tax at source on garment exports following persistent demand by the industry leaders since the rate was raised.

Officials said the government has decided in principle to cut down the rate to 0.7 per cent from the 1.0 per cent levied in the new budget on the country's main export product.

Asked about the move, National Board of Revenue (NBR) chairman Nojibur Rahman confirmed that they were working to implement the government's decision.  

"The NBR will shortly issue a statutory regulatory order (SRO) in this regard," he said.

The government has raised the tax at source to 1.0 per cent in the budget for the current fiscal year 2017-2018 from 0.70 per cent in the just-concluded fiscal.

The government also had set the rate of this tax at 1.0 per cent on readymade garment (RMG) exports in FY 2016-2017 which was later lowered to 0.7 per cent following the garment exporters' demand.

Export earnings from the sector witnessed a near-negative growth of 0.20 per cent in the last fiscal year--the lowest in last 15 years.

Painting such a situation the industry passing through, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Mohammed Nasir said the tax cutback will "help the sector face the current challenges".

Garment export fetched $28.14 billion in the last financial year by official count as against $28.09 billion in the previous fiscal, 2015-16.

Country's overall export earnings came to $34.83 billion in 2016-17 that again marked a meagre 1.69 per cent growth over the previous FY when the national export figure was $34.25 billion.

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