The country’s apparel sector has urged the government to fix 0.70% tax at source on export as final settlement instead of making it just minimum rate. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) made the call in a letter to Finance Minister AMA Muhith on July 16. BGMEA President Siddiqur Rahman sent the letter to the finance minister. The rate was earlier reduced to 0.70% from 1.50% in the proposed budget. “Although the budget for the FY16-17 proposed to set tax at source on export to 1.5% for the apparel exporters, the rate was later reduced to 0.70% following the intervention,” reads the letter. If the tax at source of 0.70% is considered as minimum tax, there are possibilities of imposing other higher taxes and there are also possibilities of harassment to entrepreneurs which will make the income tax return submission process more complex, it added. Urging the Finance Minister to intervene into the matter, BGMEA President in his letter has also requested him for giving necessary instructions to the National Board of Revenue (NBR) for amending the income tax ordinance and issue necessary rules to consider tax at source on export for the apparel makers as final settlement which the RMG makers enjoyed before. The apparel makers have so far enjoyed tax at source on export as final settlement. However, the FY17 budget turned 0.70% tax at source on export as minimum tax. During the last fiscal year, the RMG makers were enjoying 0.60% tax at source on export, which was considered as final settlement.
