Plastic goods makers want to get back VAT exemption
Release Date: June 6, 2017
The country's plastic goods manufacturers and exporters Monday requested the government to review some of the budget proposals, including withdrawal of VAT on crockeries, recycling and footwear made of plastic and rubber.
They also demanded withdrawal of source tax and reduction of corporate tax.
The government proposed in the budget for fiscal 2017-18 to withdraw the existing VAT (value added tax) exemption facility being enjoyed by the manufacturers of crockery, recycling and, rubber and plastic shoe and slipper.
"Those daily used crockery items and plastic and rubber shoes and slippers are VAT free and the rural people mostly use those items," Jashim Uddin, president of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA), told a post-budget press conference in the city.
A wide range of crockery items are recycled from used plastic which are environment-friendly and their producers, suppliers and consumers are poor people with little literacy who don't have the skills or the capacity to use ECR (electronic cash register) machine to calculate the amount of VAT, he explained.
The recycled products are used as import substitutes and many such products have been proposed to withdraw from the existing VAT exemption facility, he said, adding that products those are not being used at a large scale like refrigerators, freezers, air-conditioners and many others have been offered VAT exemptions.
Moreover, plastic and rubber shoes and slippers, those are being sold at a maximum of Tk 120 per pair, are produced by recycling the used plastic that the poor and street children collect from various places for their livelihood.
The BPGMEA requested the government to withdraw the proposed VAT from those items and allow the sector continuing with the existing VAT exemption.
There is no country in the world except Bangladesh that collects source tax on the invoice value of exportable products, he said, adding that Bangladesh was facing stiff competition in the global market because of the tax.
He urged the government to withdraw the source tax from plastic exports for next two years and reduce the corporate tax to 15 per cent for all export-oriented sectors as proposed for the readymade garment industry.
The BPGMEA president urged the government to withdraw the excise duty on bank account balance, as a hike proposed in the new budget, to encourage inflow of remittance through the banking channel and ensure transparency in the financial sector.
Their other demands included increasing the upper limit of turnover tax to Tk 50 million from the proposed Tk 15 million and reduce its tax rate to 3.0 per cent from proposed 4.0 per cent and withdraw the proposed 15 per cent VAT on potential toy industry.
- How reliable are expiration dates? October 18, 2017
- President hosts Bangladesh Parliament Speaker July 25, 2017
- DCCI for diversifying products to expand export market July 21, 2017
- Foreign Direct Investment Rises in Bangladesh July 13, 2017
- The Future of Asia 2017: Bangladesh invites investors June 21, 2017