Bangladesh Textile Mills Association (BTMA) said the FY21-22 budget proposals will hinder Bangladesh’s textile industry. Textile millers recently demanded the withdrawal of value-added tax (VAT) and import duty on all kinds of manmade fiber for the potential growth of the non-cotton fashion industry to meet the global demand.
The government did not address this issue in the proposed budget although the primary textile entrepreneurs had been demanding this for a while, the textile millers expressed at a post-budget press conference at the office of BTMA.
Highlighting the global growth of manmade fiber garments, BTMA President Mohammad Ali Khokon said, “If we want to grab more of the global market share, we will have to choose the manmade fiber as the demand is rising for those garment items.”
The government should contemplate the request, as the manmade fiber garments demand is higher than the cotton-made fiber globally.
Khokon welcomed the proposed budget, but he wants some facilities for the primary textile sector for appealing to further investment and for creating more employment.
Khokon also demanded that the government fix Tk 3 as VAT on sales per kg of all kinds of yarn in the local markets.
At present, the National Board of Revenue collects Tk 3 as VAT on the sales per kg of yarn made from cotton and Tk 6 per kg on the sales of yarn made from manmade fiber.
Therefore, the VAT rate should be uniform for all kinds of yarn sales, Khokon said.
BTMA chief urged the govt. to reset tariff on commercial imports of yarn and fabrics at $10 from $3 a kg, source tax on exports of finished garments be halved and the existing advance tax be removed on importing yarn and fabrics from man-made fibers.