An apparel-sector body has submitted to the government a crisis-management package proposal including zero-duty raw materials and trade deal with potential markets for boosting knit-garment exports in the crunch time.
The knitwear manufacturers and exporters also seek keeping government's different existing policy rates, including tax at source, corporate tax, VAT and tax, unchanged for next five years to help overcome the Covid-19 fallout and boost the country's exports.
They particularly recommend making the value-added tax (VAT) zero-rated on all goods and services collected locally for exports.
Also, the exporters seek 5.0-percent cash incentives on total investment in establishing new capital machinery "aimed at product diversification, achieving competitiveness in goods production and bringing technological excellence".
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) sent the recommendations recently to the ministry of commerce for placing with the 'National Committee on Export'.
It also expressed its gratitude to the government for supporting the sector to overcome the Covid-19 pandemic disaster that had upended global supply chains and trade.
In the package the trade body notes that the pandemic still exists across the globe and the knitwear sector of Bangladesh is not out of purview of its disruptive impact.
"The negative impact of COVID-19 on the global supply chain has not diminished, which is reflected in the higher prices of necessary raw materials for the garment industry," says the association in the country's main export sector.
Focusing on the fiscal side, the BKMEA proposes making two separate divisions/offices for collecting revenue and for revenue policy.
The association suggests making specific law and policy for exporting Bangladeshi apparel items through the global online export market.
It also suggests keeping the prices of fuel oils, power and gas at affordable rates.
The knitwear association has recommended fixing reasonable tariffs on imports of raw materials for the readymade-garment industry to encourage more investment and exports.
It seeks zero-rated duty and VAT on imports of necessary machinery and chemicals for establishing and operating Effluent Treatment Plant (ETP) and Waste-water treatment plant (WTP) plant.
Also recommended are the signing of trade agreements with target countries to ensure competitive access to the export market and forming a high-powered inter-ministerial committee head by the commerce minister or the commerce secretary to resolve different export-import complexities.
The government was taking steps to put in place adequate measures for expanding the volume of exports after graduation and the post-COVID period, said a high official, who is also dealing with the issues.
He said that many developed countries would not provide duty-free facility to Bangladesh after its graduation from LDC status in 2026.
