Speakers lauded the government for announcing budget FY 2021-22 proposing a a 10-year tax exemption for 'Made in Bangladesh' brands to speed up the establishment of mega industries and production of import-substitute industrial goods in Bangladesh.
They said, the exemption will apply to manufacturers of three- and four-wheelers, home and kitchen appliances and light engineering products under condition that their local value addition will be 20%-40%, local employment and promote the "Made in Bangladesh" brand. During the last one decade, locally-manufactured household equipment have taken up 90% of the total market. Apart from local entrepreneurs, foreign companies such as Samsung and LG have set up factories in the country.
However, they also proposed a five-year extension of the VAT exemption for manufacturers of motor cars and motor vehicles to 'maintain the existing momentum of growth in local industries'. In addition to tax exemption, these industries will also enjoy VAT and advance Income tax (AIT) for import of raw materials / components.
Companies producing three- and four-wheelers could get further ten-year exemption if they met additional condition of investment of at least Tk100 crore.
The speakers were brainstorming at a webinar titled on "The National Budget for 2021-22: Private Sector Perspective" jointly organized by International Business Forum of Bangladesh (IBFB) and Bangladesh Enterprise Institute (BEI) on Saturday.
Planning Minister M. A. Mannan, MP, was the Chief Guest at the webinar presided over by Energypac Power Generation Ltd Managaing Director and CEO IBEF President and Humayun Rashid. Centre for Policy Dialogue (CPD) Senior Research Fellow Towfiqul Islam Khan was the Key Note Speaker.
IBFB Vice President M.S. Siddiqui, Policy Exchange of Bangladesh Chairman Dr. M. Masrur Reaz, Former NBR Chairman Dr. Muhammad Abdul Mazid, Bangladesh Institute of International and Strategic Studies Research Director Dr. Mohammad Mahfuz Kabirspoke as Designated Discussants.
BEI President Ambassador M Humayun Kabir delivered the welcome remarks and IBFB Vice President Finance Ms. Lutfunnisa Saudia Khan, delivered the vote of thanks.
Among others Mr. Hafizur Rahman Khan, Immediate Past President, IBFB and Chairman, Runner Group of Companies, Dr. Md. Ali Afzal, Director, IBFB and Managing Director, Krishibid Group, Lt. Gen M. Harun-Ar-Rashid, Bir Protik (Retd.), Chairman, Governmental Relation and Advocacy Committee, IBFB, Managing Director, Rashid Krishi Khamar Limited and Prof. Dr. Hosne Ara Begum (Ashoka Fellow & PHF), Founder Executive Director, TMSS, Bangladesh spoke at the webinar.
The budget also proposes to withdraw AIT (advance income tax) on certain raw materials of iron products, scrap vessels. Similar withdrawal also proposed for the raw materials ethylene glycol, terephthalic acid, ethylene/propylene of advanced industries such as PVC and PET Resin. The AIT on import of ocean-going ships and raw materials of cement has been reduced by one percentage point.
The speakers also proposed VAT exemption facilities be extended for manufacturers of LPG cylinders by another year, and for refrigerators, freezers and their compressors by one more year, polypropylene staple fibre by two more years, air conditioners and their compressors by three more years, and motor cars and motor vehicles by five more years.