The country's private jute millers demanded waiver of source tax on export subsidy in the national budget for the upcoming fiscal year (FY), 2022-23.
Currently, 10 per cent source tax is imposed on cash subsidy, which is not rational for the jute sector - considering its present ailing condition, they added.
The Bangladesh Jute Mills Association (BJMA) recently placed the demand and observation in its budget proposal to the National Board of Revenue (NBR), urging the government to consider the present situation.
At the same time, the trade-body also made the appeal to the Ministry of Textiles and Jute.
The jute millers proposed reducing the source tax from 0.60 per cent to 0.25 per cent on export earning of jute goods, as the sector has been passing through hard times because of the Covid-19 pandemic.
They sought exemption of all kinds of VAT and source tax on the machinery and services related to production of exportable jute goods.
On the other hand, no Harmonised System (HS) code has so far been created for export of diversified jute products. The association proposed introducing the code to help identify the products.
Currently, the sector is enjoying up to 20 per cent cash incentive on export earning. The millers requested to increase the subsidy to 25 per cent.
They suggested the government to allocate Tk 10 billion for payment of cash incentive on export of jute products in the new fiscal year.
The BJMA also demanded a Tk 100-billion low-cost fund for development of jute sector.
