EAB demands re-fixing corporate tax at 10%, tax at source at 0.25% for RMGs

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DHAKA, June 10, 2018 (BSS) – Hailing the proposed national budget of Taka 4,64,573 crore for FY19, the Exporters Association of Bangladesh (EAB) has demanded the government reduce the proposed corporate tax for the RMG industries by 5 percent to fix it at 10 percent.

The EAB also demanded the government cut the tax at source at 0.25 percent from the existing 0.70 percent and keep it for at least five years.

A post-budget statement of EAB, signed by its president Abdus Salam Murshedy, today said the corporate tax rate for the RMG industries has been raised by 3 percent to 15 percent from the existing 12 percent in the proposed budget, while the corporate tax rate for the banks has been reduced.

“We think that the entrepreneurs of the RMG industries will be discouraged due to the increase in the corporate tax rate for the RMGs. We request the government to reconsider fixing the corporate tax rate at 10 percent for the RMG industries. It is necessary to reduce the corporate tax rate for the environment-friendly RMG industries by at least 5 percent,” added the statement.

The EAB in its statement also said that the proposed tax at source of 1.0 percent for the RMG industries, instead of the existing 0.70 percent, to be made effective from July 1 this year would make the usual operations of the export-oriented RMG industries stagnant and thus reduce the capacity of the industries.

“We stick to our previous proposal of fixing the tax at source at 0.25 percent and thus keep it for at least five years,” added the EAB statement.

Apart from this, the EAB also demanded deduction of tax at source as a final tax liability not as minimum tax side by side fixing the tax at source for the terry towel and home textile sectors at 0.25 percent and thus keep the rate for at least 5 years.

The EAB also extended its heartfelt thanks and gratitude to Prime Minister Sheikh Hasina and Finance Minister Abul Maal Abdul Muhith for prioritizing on power and energy sector, development of overall transport infrastructures, education, building skilled human resources and making notable allocations for the mega projects.

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