Request for 1yr VAT suspension in garment industry...

Dhaka, Sunday   07 June 2020

Beximco LPG Gas

Request for 1yr VAT suspension in garment industry

 Economy Desk

 Published: 03:51 PM, 2 April 2020  

File Photo

File Photo

BGMEA has requested the government to suspend VAT of a year to recover business losses due to coronavirus.

BGMEA President Rubana Huq made the request in a letter to the Chairman of the National Board of Revenue (NBR).

The letter stated that the VAT related to the export-oriented garment industry should be suspended for one year. In addition, the time limit for depositing the documents for a bond audit during the emergency period should be extended to one year.

Rubana Huq said in the letter, the bonding period against the damaged export invoice needs to be extended for one more year. In addition, the notice to show the ongoing claims and reasons arising during the emergency period should be kept suspended for one year, after which the exemptions and penalties arising during the emergency period and VAT claim in the textile industry should be suspended for one year.

The COVID-19 is currently declared a global pandemic. In this situation, international brands and buyers are postponing their current purchases. In addition, future purchasing orders are also being reduced. Due to which the business is being damaged, and the export is having a negative impact.

The letter also said that the supply chain of the garment industry had collapsed due to coronavirus. As a result, raw materials cannot be imported in a timely manner. Because of that, the purchase will be canceled. And the stock lot will be created due to being unable to export the garments made by imported goods. Annual audits cannot be completed on time. Bond license renewal activities will be interrupted at certain times.

As a result, claims against the garment industry will arise for various reasons. Fines will be levied for failure to comply with customs laws. BGMEA seeks legal assistance to avoid these situations.

Regarding BGMEA's letter, NBR officials said that a letter will be sent to the Dhaka and Chittagong Bond Commissionerate to find out the rationale for the BGMEA’s demand. Their comments will be reviewed at the NBA's top level. Then the matter will be raised to the Finance Minister.