Govt taskforce decides 5pc incentive for penetrating new markets
The government will provide development incentive to the garment industry for three years for exporting clothes to new markets.
The incentive would be five percent on export earning in the first year, four percent in the second year and two percent in the third year.
The decision came at a meeting of the taskforce on making strategies for the country’s export sector suffering for global economic recession. Finance Minister AMA Muhith chaired the meeting at his office at the secretariat.
The minister told reporters after the meeting that, “Garment manufacturers making exports to countries other than the USA, Canada and European Union will get the incentive”.
For this, the government would create a new fund from the budgetary allocation of Tk 2000 crore for providing incentives to exporters of different sectors, he said.
The exporters will get the new incentive in addition to the earlier five percent incentive given to all garment exporters, he mentioned.
The meeting also took some other decisions which will be notified in a circular to be issued tomorrow, Muhith noted.
He also said the backward linkage industries of the garment sector, which do not get any incentives now, would also be provided with a five percent incentive for a year on their sales.
The industries, however, have to be certified by the Bangladesh Garment Manufacturers and Exporters Association and Bangladesh Knitwear Manufacturers and Exporters Association for the incentive.
In the present fiscal year, the government raised the tax at source to 0.50 from 0.25 percent. Since then, garment exporters have been demanding that the tax rate should be lowered.
Sources said the meeting decided to lower the tax at source to 0.40-0.30 percent. The National Board of Revenue will decide it.
Bangladesh Bank Governor Dr Atiur Rahman, Finance Secretary Dr Mohammad Tareq, NBR Chairman Dr Nasiruddin Ahmed and other high officials of the finance ministry were present at the meeting.
