The BPGMEA thanked the government for giving VAT exemption facility to the process of recycling plastic waste to produce granules
The Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA) has urged the government to curb unnecessary expenses and take practical steps to properly implement the budget for the 2020-21 fiscal year.
On behalf of the BPGMEA, the association's President Md Jasim Uddin made the comment on Sunday in reaction to the budget, read a press release.
He also congratulated Finance Minister AHM Mustafa Kamal for placing the budget and lauded him, addressing issues such as keeping the wheels of the economy turning in Bangladesh, providing health security to its people and tackling the economic realities of the future.
The release further said, "The government has taken a bold step to counter the ongoing economic crisis by setting targets such as reviving economic activities, creating new entrepreneurs, increasing investments, expanding industrialisation, protecting domestic industries, creating employment opportunities, alleviating poverty.
"The government also took steps to achieve Vision 2021 and 2041, Sustainable Development Goals (SDGs), and graduation from the least developed country (LDC) category. But to achieve these targets, the government must take practical steps and curb any unnecessary expenses."
The BPGMEA thanked the government for giving VAT (Value Added Tax) exemption facility to the process of recycling plastic waste to produce granules.
However, the association pointed out that VAT is still being imposed on plastic goods such as plates, jugs, mugs, bowls, tiffin carriers, water bottles, buckets and baskets, which is primarily used by people of low income groups and the extremely poor.
The BPGMEA urged the government to withdraw VAT on plastic products, so that poor people can buy them amid the Covid-19 crisis.
The press release further read, "The government has imposed VAT on all manufactured products under the plastic sector irrespective of turnover through a general order from the National Board of Revenue (NBR).
"It will be difficult for us to keep small and medium industries in the plastic industry afloat after paying this VAT. So, we are urging the government to cancel that order."
Meanwhile, BPGMEA President Md Jasim Uddin thanked the government for helping to keep workers and labourers employed during the pandemic, pay their salaries and preserve competitiveness of entrepreneurs by announcing a Tk100,000 crore stimulus package.
He added, "However, it is essential to make the process of disbursing the assistance and incentives realistic, simple and straightforward with the help of a joint committee comprised of entities such as the organisations concerned and the Federation of Bangladesh Chambers of Commerce & Industries.
"Otherwise, many entrepreneurs from the micro, small and medium industries will be deprived of such incentives."
The BPGMEA lauded a number of steps revealed in the proposed budget, such as exempting Personal Protective Equipment (PPE) and surgical masks (including face masks) from the VAT list, raising the threshold of tax-free income to Tk3 lakh, and giving a tax rebate of Tk2,000 to those who will file their income tax returns online for the first time.
The press release added, "The collection target for the National Board of Revenue (NBR) has been set at Tk330,000 crore. However, around Tk200,000 crore revenue would be earned in the Fiscal Year 2019-20.
"Under the circumstances, we believe that the revenue collection target of Tk330,000 crore is not realistic amid the downward economic trend. This will put the burden of indirect taxes on the consumers, as well as on the manufacturing sector."
The association pointed out that the ease of doing business in the country must be improved further and the NBR should achieve its target of automation completely and skillfully.
The government will extend the tax holiday facilities to seven new sectors, which are artificial fibre or manmade fibre manufacturing, automobile parts and components manufacturing, automation and robotics design and manufacturing, including parts and components thereof, artificial intelligence-based system design or manufacturing, nanotechnology-based products manufacturing, aircraft heavy maintenance services, including parts manufacturing; and electrical transformer manufacturing.
Under the current provisions of the income tax ordinance, these industries will enjoy tax holidays for up to ten years on condition.
Commenting on the matter, BPGMEA President Md Jasim Uddin thanked the government for this industry-friendly initiative.
"We sincerely urge the government to include the plastic industry as the eighth sector which will get the tax holiday. This sector has limitless potential and is consumer friendly," he added.