The Bangladesh Textile Mills Association (BTMA) recently sought cent per cent import duty exemption for all types of fibre as the global demand for diversified clothes has been on the rise. It also suggested raising the wastage rate for producing yarn from raw cotton to 17 per cent from 10 per cent. The government allows duty-free import of five types of traditional fibres—raw cotton, polyester staple, viscose staple, tensile and flux fibre.
“Nowadays, our foreign buyers specify fabrics and fibres for their ordered clothes. So, textile mills are importing many little-known fibres, apart from the traditional ones, as per their requirements,” BTMA president Mohammad Ali Khokon wrote in a letter to the ministry of commerce.
“Even, the fibres are not on the customs schedule containing the Harmonised System (HS) codes (a standardised numerical method of classifying traded products). As a result, textile mills import the little-known items under HS codes for similar products. Unfortunately, the customs authorities sometimes identify such imports as false declarations and fine importers,” Khokon said, adding that it was not the fault of importers.
The Bangladesh Textile Mills Association has sought cent per cent import duty exemption for all fibre types as the global demand for diversified clothes has been on the rise.It also suggested raising the wastage rate for producing yarn from raw cotton to 17 per cent from 10 per cent. The government allows duty-free import of five types of traditional fibres.
He urged the government to take necessary steps for hassle-free imports and exempt duties on all the non-traditional fibres to promote export diversification and expansion, according to Bangla media reports.
Non-traditional fibres include synthetic staple, linen, Lycra T-40, Remie, acrylic staple, cationic cotton, textured, metallic, pulled fibres and PCW.
The BTMA, in the letter, requested the ministry to brief the National Board of Revenue about the matter so that the revenue agency can consider the duties exemption in formulating the national budget of the upcoming fiscal.
The trade body also requested the government to continue the 15 per cent corporate tax rate facility until 2026 for companies in the sector. The tax waiver is supposed to end in June this year, which the sector has been enjoying since 2019-20 fiscal.
The association said the reduced corporate tax rate helped them increase capital and continuing such a facility would also benefit the government in the long run.
The trade body also demanded reducing import-duties on textile parts like capital machinery to 1 per cent from the existing 26-104 per cent and cutting down value-added tax on locally manufactured yarn to Tk 3 per kg. Currently, it is Tk 6 per kg. Mentioning that the real wastage rates in yarn production were higher than government fixed rates, the organisation called for increasing the rates to 17 per cent for the yarn for raw cotton, up from the existing 7-10 per cent.
It suggested a 34 per cent wastage rate for producing yarn for export purposes, which is currently 10-12 per cent.
Fibre2Fashion News Desk (DS)