Finance Minister AHM Mustafa Kamal has placed a Tk6,78,064 crore national budget for the 2022-2023 fiscal year (FY23) on Thursday. Here is everything you need to know if you are a RMG manufacturer.
50% reduction of VAT on Man-made fibres: The government reduced VAT on yarn from man-made fibre and other fibres from Tk6 per kg to Tk3 per kg. This is a similar rate to VAT on the sale of cotton-made yarn.
Raw materials source tax down to 4%: The source tax rate on raw materials has been reduced to 4% from 7%. Moreover, the source tax rate on supplies of trading goods has been reduced to 5% from 7% and on supplies of books except those by the government to 3% from 7%.
21% increase in subsidies for the energy, liquefied natural gas and power sectors: The Govt. has increased subsidies by 21% for the energy, liquefied natural gas and power sectors. This is expected to boost the power supply to industries and reduce the cost of doing business.
Extension on reduced corporate tax for textile mills: The government has extended the duration for textile millers to enjoy a reduced 15% corporate tax for the next three fiscal years. The proposed extension will expire on June 30, 2025.
A universal pension scheme introduced: A universal pension scheme for citizens aged 61 and above will be introduced from fiscal 2022-23.
Doubling Source Tax on Export: The government has doubled the source tax on export from 0.5% to 1%.
Photo Courtesy: Canva
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