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Bangladesh: BTMA demands VAT exemption for yarn and fabric

Bangladesh Textile Mills Association (BTMA) has urged the government to include yarn and fabric as VAT exempted items as the sale of local yarn and fabric has declined drastically. BTMA says, sale of fabric and local yarn in the country has reduced drastically and 50-60 per cent of the looms have remained closed for a long period of time. The yarn, fabric and other dress-making materials are being imported under mis-declaration and duty-free facilities, causing threat to the local mills. Woven dying mills have reduced their capacity below 40 per cent while export-oriented spinning mills are forced to sell their products at a lower rate compared to their production cost resulting in huge stockpiling of yarn and fabric.

BTMA has demanded an increase in cash incentives to 15 per cent from existing 4.0 per cent besides a strong monitoring to stop imports under mis-declaration and misuse of the bonded warehouse facilities. The association also urged the government to launch a drive in the textile producing areas to prevent sales of illegally imported yarns and fabrics and to ensure proper management of bonded warehouses.