They have also requested the VAT (value added tax) authority to withdraw the slapped tax on rented space to cut production cost of small and medium RMG units.
The government slapped 15 per cent VAT on rented space in 2009-10 budget.
Recently, National Board of Revenue (NBR) has taken a move to ensure proper tax collection from the measure after it has found RMG units not following the rules.
Field offices of VAT wing have sent several warning letters and took some action against a few RMG units for non-payment of the tax.
"Production cost of the export-oriented RMG units will go up significantly if 15 per cent VAT is included with the cost. Thus RMG exporters will not be able to compete in the international market," Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Abdus Salam Murshedy said in a letter to the NBR.
"Small and medium RMG units run their factories in rented space. Those units will be affected due to the tax," he wrote to the NBR chairman.
The BGMEA has requested the NBR not to take any legal action against the RMG units for non-payment of tax until an order on waiver of the fees is issued.
Earlier, Finance Minister AMA Muhith assured the RMG exporters to consider waiver of the 15 per cent VAT on rented space.
He has also instructed the revenue board to review the budgetary measure for RMG exporters.
Meanwhile NBR officials said, waiver of the VAT on rented space is under consideration of the board but as the measure is still in place, field offices are bound to enforce the measure.
-FE, Fri, 29/10/2010
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