FROM THE EDITOR-IN-CHIEF’ s DESK …
The conflict of interest between what the nation needs and what industry wants, has always been a great balancing act for Governments when announcing budget allocations and proposals. The recent budget announcement for the Financial Year 2017-18 has been no different. While in certain areas, the national interest in terms of the masses has been safeguarded, in other cases efforts have been made to support growth of the industry.
While the industry is happy with the increased allocation for improving infrastructure, concerns regarding increased taxation burden on the industry are afloat. Gas prices are already increasing substantially and with imposition of 15 % VAT on gas and power price, the cost of fuel and power will reach a new peak. For the garment industry that operates on very less profit margin, this rise may be devastating and some fear it may even cause closure of many businesses.
It is being widely said that no significant amount has been allotted for the encouragement of industry; instead the Government has presented a budget that proposes apparel exporters to pay 1 % of their export earnings as source tax which was previously 0.7 %. This has really been a blow to the industry.
Industry bodies are demanding that Government should reduce the source tax to zero per cent as the garment sector has been passing through a bad time. The industry is also not happy with the reduction of the corporate tax of garment factories to 15 % from 20 % at present. It is not enough to cover up the extra cost of operations that the companies are facing today.
BGMEA has demanded a reduction in the corporate tax at 10 % and cash incentives at 5 % for at least the next two years so that the sector can face the challenges of falling export, stemming from a volatile global economy.
There has also been a suggestion that companies running‘ green’ factories should be‘ rewarded’ and the difference in the corporate tax for the garment factories and‘ green’ garment factories should at least be of 5 % as this would encourage companies to set up more‘ green’ units, which will save more energy and water. In the current budget, the Finance Minister has proposed 14 % corporate tax for the‘ green’ units, just 1 % below that of other industries.
It is being argued that while cost of production increased by 18 % in last two years, exports have declined by 6.80 % in the US market and by 5.91 % in the UK market in July-April period of the current financial year. Also, the industry that has witnessed over 13 % growth over the last 10 years has seen the growth decline to less than 3 % in recent months which is a cause of great worry.
The next two years are extremely critical in deciding where the industry will go; hence strong support from the Government at this juncture is very important. We can all hope that the Government is listening!
EDITORIAL TEAM
EDITOR-IN-CHIEF EDITOR DEPUTY EDITOR COPY EDITOR ASST. COPY EDITOR CREATIVE TEAM
PHOTO EDITOR OPERATION DIRECTOR
Deepak Mohindra Ila Saxena Deepankar Shyam Veereshwar Sobti Sahil Sehgal
Raj Kumar Chahal Peeush Jauhari Satyapal Bisht
Himanshu Kumar Mayank Mohindra
PUBLISHER & |
Renu Mohindra |
MANAGING DIRECTOR |
+ 919810058986, 01964874405 |
rmohindra @ apparelresources. com |
COUNTRY OFFICE
Apparel Resources Private Limited Apartment B-2, House No. 26, Road 18, Block A, Banani, Dhaka- 1213, Bangladesh Phone: + 880 255035623
HEAD OFFICE
Apparel Resources Private Limited B-32, South Extension-1, New Delhi-110 049( India) Phone: 91-11-47390000, E-mail: editor @ apparelresources. com Web associate: www. apparelresources. com
SUBSCRIPTION RATE
Yes, I wish to subscribe to Apparel Online |
Taka 2400.00 |
12 issues |
* This rate is valid only for subscription in Bangladesh |
International subscription( in Dollar)- Credit Card using www. apparelresources. com Telegraphic transfer to Bank Account No. 03192320003806( Swift No: HDFCINBB) with HDFC Bank, D-9, South Extn. Part-2, New Delhi-110049. INDIA
SUBSCRIPTION ENQUIRY
+ 8801842814616 amamun @ apparelresources. com
+ 8801611547143 mazumder @ apparelresources. com
subscribe @ apparelresources. com
ADVERTISEMENT AND GENERAL ENQUIRY
+ 8801842814616 amamun @ apparelresources. com
+ 919811088666 rani @ apparelresources. com
8 Apparel Online Bangladesh | JULY 2017 | www. apparelresources. com