It is interesting to note that Bangladesh’s garment accessories sector recently demanded the same incentives that have been offered to the readymade garment industry in the proposed 2020-21 budget, urging reduction in corporate tax rate for their sector to 12 per cent. The apparel sector now pays 12 per cent corporate tax, while it is 35 per cent for the accessories and packaging makers.
The Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) also urged the government to keep source taxes unchanged at 0.25 per cent instead of the proposed 0.5 per cent.
“As per the export-import policies of Bangladesh, direct and prospective exporters are entitled to enjoy equal facilities. But our corporate tax rate is higher than other direct export-oriented sectors, including the RMG sector,” BGAPMEA president Abdul Kader Khan was quoted as saying by Bangla media reports.
For fiscal 2020-21, the government has set the corporate tax rate for the garment accessories sector at 32.5 per cent.
Most of the manufacturers in the sector are small and medium enterprises, which have been hit the hardest by the COVID-19 pandemic.
He also urged the government to include the sector for cash incentives as it exports its goods directly as part and parcel of exports themselves.
