Source Tax Benefit on Export to be implemented from July 1

Source Tax Benefit on Export to be implemented from July 1

The Government of Bangladesh has made an announcement of reducing source tax on export earnings further for readymade garment (RMG) and other sectors from 0.6 per cent to 0.25 per cent recently. The National Board of Revenue (NBR) issued a statutory regulatory order amending its last order on the issue and the benefits will be offered from July 1 with retrospective effect.

The government was pressurised by garment makers and exporters to take initiative and measures to boost readymade garment and other sectors. This pressure by exporters and garment makers led NBR reportedly took the decision to present in front of the government.

According to official sources, “The benefit would be effective for the current fiscal.” Exporters will be able to adjust the previous tax paid at a higher rate. Source tax reduction, however, will not be applicable for earnings from jute and jute goods export.

Last year on September 5, NBR for the first time reduced the tax rate for export-oriented sectors to 0.60 per cent from one per cent reinstated in the budget for the current fiscal, primarily due to pressure from Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

– Apparel and Textile News, Apparel Talk, Indian Apparel