DHAKA, June 13, 2022 (BSS) - Hailing the proposed budget for fiscal year (2022-23), the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) today demanded of the government to keep intact the tax at source at 0.5 percent for the next five years to give comfort to this sector during this crisis time.

"It's our earnest request, if the tax at source against exports could remain at 0.5 percent for the next five years, then this sector will remain in comfort during this crisis time. If the industry sustains, then revenues will come while newer employments will be generated," said BGMEA President Faruque Hassan while addressing a press conference in a city hotel.

BGMEA senior vice president SM Mannan Kochi and vice president Md Shahidullah Azim and board directors were present, among others, on the occasion. BGMEA director Barrister Shehrin Salam Oishee moderated the press conference.

Faruque also hoped that Prime Minister Sheikh Hasina and Finance Minister AHM Mustafa Kamal would consider the issue of keeping the tax at source at the existing 0.50 percent.

He said that the government and all concerned should remain prepared to face the possible recession in Europe and USA adding, "Under the circumstances, the march forward of RMG sector, the highest foreign currency earning sector, should be kept smooth by any means," 

Giving an analysis, he said that in the outgoing fiscal year (FY22), the export earnings is likely to fetch $41 billion or around Taka 3.56 lakh crore considering the Taka and dollar exchange rate at 87. Under such estimation, Taka 1,783 crore is likely to come as tax at source.

He informed that the exports earnings are likely to reach $45 billion or around Taka 4.14 lakh crore in the next fiscal year (FY23) considering the exchange rate at 92. In such condition, Taka 2,070 crore is likely to come as tax at source.

"If we can boost exports through enhancing competitive edge, then it will be possible to increase the revenue collection without raising the tax rate. If so, our macro economy will be benefitted," he added. 

Besides, the BGMEA president demanded of the government to provide 10 percent special incentives on export of non-cotton RMG items as well as withdrawing 10 percent income tax on cash support.

Answering to a question, Faruque welcomed the government's step for providing tax amnesty for bringing in the undisclosed money and wealth from abroad in the mainstream of the economy.

"The whole of the world is now under pressure of foreign currency while demand of RMG items is declining and there is further possibility of fall in demand. Under such circumstances, if such foreign currency comes through such provision, then it's good. We'll stand beside such decision of the government," he added.

He told another questioner that necessary investments are being made to boost the production of man-made fibers while export of such item is likely to pick up from next year.

Replying to another question, the BGMEA president said that all concerned including the business community would definitely avail benefits from the Padma Bridge once it is officially launched on June 25.

He also mentioned that the BGMEA has been working constantly for ensuring welfare of the garment workers. He said after tripartite discussion with the concerned stakeholders, the new wage board for the workers is likely to be formed considering the capacity of the industry and all related issues.

Faruque said many factories are providing essential commodities to workers from their fair price shops adding that such coverage would be expanded in phases. 

Extending his heartfelt thanks to the premier for her firm and dynamic leadership for positioning Bangladesh into a strong zone overcoming the shocks of the pandemic, he said that the Prime Minister has safeguarded the lives and livelihood of the workers through giving stimulus during the pandemic.

Besides, he noted that the placing of Taka 6,78,064 crore proposed budget for the next fiscal year (FY23) by Finance Minister AHM Mustafa Kamal is a 'courageous step'.

The BGMEA president noted that the slashing of corporate tax rates in the new budget would be helpful for materializing the vision for industry, trade and employment oriented economic development as well as boosting the export earnings.

He said that the recent fire incident at BM Depot in Sitakundu is a major blow to the RMG industry after the pandemic and the Russia-Ukraine war as the loss of image of the country was higher than financial loss.

In order to avert the reoccurrence of such incident in future, he also urged the concerned authorities to conduct regular off-dock audit and bring everything under intense compliance.

The BGMEA president also highlighted the outcomes of their visit to Europe from May 29 to June 10, 2022 as part of apparel diplomacy.