Loading...

SMEs seek equal bond facility like RMG

NBR chief holds pre-budget discussion with associations


FE Report | Published: April 24, 2019 10:27:09 | Updated: April 25, 2019 10:01:05


- Collected

The small and medium enterprises (SMEs) have sought equal bonded warehouse facilities for all exporters to help diversify export items and sustain in the competitive global market.

In a pre-budget meeting on Tuesday, they also demanded the similar facility that the readymade garment (RMG) exporters are enjoying in terms of designated bonded area.

Currently, the entire factory premises of the members of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is considered as the bonded area while the other exporters, including Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA), are not entitled to enjoy the similar facility.

They are allowed to enjoy the bonded facility for only a part of area of their factories.

The Small and Medium Enterprises (SME) Foundation adviser Md Shahabuddin made this demand in the meeting with the National Board of Revenue (NBR).

Bangladesh Agricultural Machinery Merchant Association (BAMMA), Bangladesh Tea Association and CTO forum Bangladesh also placed their pre-budget proposal for the fiscal year 2019-20 in the meeting.

Khandaker Moinur Rahman, president of the BAMMA, requested to impose 2.0 per cent Advance Income Tax (AIT) on import of agricultural machinery instead of existing 5.0 per cent Advance Trade VAT.

He also requested to withdraw 15 per cent VAT on diesel spare parts.

The CTO forum founder president Tapan Kanti Sarker proposed to frame a separate income tax policy for the foreign and local IT consultants, offer tax benefit to IT training provider companies and sought tax incentives for local cyber security experts.

Bangladesh Tea Association chairman M Shah Alam proposed to continue with the existing TTI (total tax incidence) some 91.37 per cent in the upcoming budget for import of black tea.

He said the import of cheap and substandard tea should be controlled to encourage production of tea locally.

Mr. Alam also sought reduced tax benefit, at a rate of 1.0 per cent, as capital machinery for import of sprinkler irrigation systems and equipment and HDPE pipe and Aluminum pipe.

Currently, the TTI is 104.79 per cent for import of the products as the customs authority assesses those separately.

The SME Foundation adviser proposed to cut import duties on spare parts of agricultural machinery, base-metal such as fore-alloys and aluminum alloys, other alloys steel that are used as raw materials for hollow drill bars and rods and stainless steel sheet, bars and rods, wire.

He also proposed to cut import duty on printed melamine transfer paper, increase import duty of LED light parts, exempt VAT on production and marketing stage of agricultural machinery, introduce unified VAT rate and registration for printing press.

Mr Shahabuddin proposed to cut the VAT rate for light engineering sector and exempt VAT on locally produced honey.

On income tax, he proposed to waive AIT at import stage, withdraw 35 per cent corporate tax on plastic recycling industry, offer tax holiday for new SME entrepreneurs, cut source tax for other exporters and reduce corporate tax rate to 15 per cent for all exporters.

Meanwhile, another meeting was held with the representatives from different associations including agro-processors, agro-machinery manufacturers, jewellers, poultry industry and bread-biscuit manufacturers.

In the meeting, NBR Chairman Md Mosharraf Hossain Bhuiyan said the rates of value added tax (VAT) would not be increased for the old VAT payers rather it might reduce in some cases.

However, the people who do not pay the VAT will come under the net while the collection will increase after distribution of the electronic cash registers (ECR) among the traders.

Mr Bhuiyan said, "We will impose 15 per cent VAT on some sectors, few of which would enjoy rebate facility, while multiple VAT rates like 10 per cent, 7.5 per cent and 5.0 per cent will be applicable for other sectors," Mr. Bhuiyan said.

He also said local manufacturers of different sectors who want to export their products will get required support like garments industry.

Mentioning agro-processing a 'thrust sector' as per the National Industrial Policy-2016, Bangladesh Agro-Processors' Association (BAPA) president AFM Fakhrul Islam Munshi urged the government to provide loans to the sector at a single digit interest rate.

Placing BAPA's pre-budget proposal, he demanded withdrawal of existing 5.0 per cent advance income tax (AIT) and 0.6 per cent turnover tax on agro-processing sector.

Referring to 3.0 per cent to 15 per cent corporate tax on poultry and fish feed industries and dairy product manufactures, he urged the revenue authority to bring down corporate tax on the sector to that level from current 35 per cent.

Responding to BAPA's demands, the NBR Chairman said export-oriented agro-processors enjoy cash incentive and they will get other facilities like the big exporters.

"The state-run banks are providing loans at single digit interest rate according to the central bank's directives, but may be the private banks are defying the instruction," he said.

He suggested BAPA to send a letter to the Financial Institutions Division, addressing the Finance Minister, requesting him to take steps in this regard.

Bangladesh Jewellers' Samity (BAJUS) demanded swift enactment of the Gold Policy 2018, which remains at the drafting stage.

BAJUS Vice President Enamul Haque Khan said according to a directive, jewellers need to declare their stock of gold by May 08, which is not possible before formulation of the policy.

"If we don't declare our gold reserve, NBR would not accept our VAT chalan after May 08. So, we urge the authorities to defer the deadline by three more months," Mr. Khan said.

The board chairman assured the jewellers of keeping it in mind.

He also said that the gold policy cannot be enforced before the Finance Act coming into effect on July 01 next.

Agricultural Machinery Manufacturers Association, Bangladesh (AMMA-B) President Alimul Ehsan Chowdhury urged the NBR to slash income tax on the profit of agro-machinery manufacturers from 35 per cent to 10 per cent.

There are VAT exemption on manufacturing, marketing and supply of agro-machineries, but names of some agro-machinery were not mentioned in the list published through a statutory regulatory order (SRO), he said.

Mr Chowdhury proposed to include names of power reaper, power tiller operated seeder, combined harvester, low-lift pump, diesel engine, tractor and rotary tiller in the VAT exemption list.

Bangladesh Poultry Industry Association urged the NBR to declare poultry industry as an agricultural sector so that it could enjoy tax benefits for further development.

Feed Industries Association of Bangladesh (FIAB) President Ihtesham B Shahjahan demanded withdrawal of 5.0 per cent regulatory duty (RD) on poultry feed raw material soybean meal.

He also urged to remove 5.0 per cent AIT on 19 other raw materials of poultry and fish feed like maize, fish oil, vegetable fat, Kasava, lime stone, chick boost, enzyme etc.

Bangladesh Bread, Biscuit-O-Confectionary Prostutkarak Samity President Md Jalal Uddin proposed to continue VAT exemption on handmade bread and biscuit priced up to Tk 100 per kg and cakes up to Tk 150 per kg.

Bangladesh Auto Biscuit and Bread Manufacturers Association President Md Shafiqur Rahman Bhuiyan said the government imposed higher duty on imported biscuits to protect local producers.

"But we are not getting benefit because under invoicing is taking place in cases of importing foreign biscuits; so NBR should take appropriate steps to stop it," he added.

ahb_mcj2009@yahoo.com

doulot_akter@yahoo.com

Share if you like