Apparel exporters in Bangladesh want time to implement the new wage structure. They say if they are not given cash incentives many entrepreneurs would be ruined in implementing the new wages and workers would be jobless. They have asked for a 20 per cent cash incentive.

In the 2019 financial year, the government cut source tax on export earnings twice in export-oriented sectors, including the apparel sector, and lowered the source tax on expert proceeds to 0.25 per cent from one per cent for the financial year.

The apparel sector would be the key beneficiary of the tax cut as the sector alone accounts for 83 per cent of the total exports of the country. Apparel exporters want a four per cent cash incentive on exports to new markets. Export-oriented industries also enjoy tax exemption on the import of raw materials in the 2016-2017 financial year under the bonded warehouse facility. They also avail of duty cuts against the import of inputs such as fabrics, yarn and accessories.

Other than the cash incentive, cuts in source tax and bonded warehouse facility, the apparel sector enjoys a reduced rate of corporate tax and a waiver on value added tax on utilities.