Business

Advertisement

 

BJMC seeks tax benefits for jute mills for 4yrs

Jasim Uddin | Published: 00:00, Aug 15,2019

 
 

The Bangladesh Jute Mills Corporation has demanded extension of the income tax benefits for state-owned jute mills for four more years.

It also demanded reinstatement of advance income tax on sales and supply of jute goods at local market at 1 per cent.

Jute goods producers, both corporate and individuals, have been enjoying income tax benefits at reduced rate of 10 per cent since the fiscal year 2016-2017 and the special tax scheme for the sector is set to expire June 30, 2020.

Jute mills under the BJMC enjoyed advance income tax at the reduced rate of 1 per cent to 2 per cent on sales and supply of goods in local market taking exemption certificates from the National Board of Revenue till the recently concluded financial year 2018-19.

The NBR is now declining to issue the exemption certificates arguing that the mills would not get the reduced AIT benefits as the tenure of the reduced corporate tax scheme would expire in the current fiscal year.

BJMC chairman Shah Muhammad Nasim on July 28 requested NBR chairman Md Mosharraf Hossain Bhuiyan to issue a statutory regulatory order extending the tenure of corporate income tax for four more years up to the fiscal year 2023-2024 and reducing the AIT at 1 per cent.

He said that 22 jute mills under BJMC purchased raw jute and produced jute goods, including sacking, hessian, carpet backing cloth, jute yarn and other diversified jute goods, for both domestic and export markets.

BJMC incurs losses every year due to ‘higher production cost’ compared with the sales prices of the products as the corporation gives wages and allowances to its workers as per the government wage structure, he said.

NBR in the budget for the current FY2020 also increased the source tax on export of jute goods to 1 per cent from 0.60 per cent although BJMC mills were incurring losses, he wrote.

On the other hand, various government agencies including director general of Food and Bangladesh Agricultural Development Corporation deduct 1 per cent to 2 per cent tax on payment for purchasing jute bags from BJMC, he said.

The rate of advance income tax on supply of jute bags to the government agencies would increase up to 5 per cent in the current FY2020 if the tax benefits at reduced rate were not extended, he said.

More about:

Want stories like this in your inbox?

Sign up to exclusive daily email

Advertisement

images

 

Advertisement

images