The Bangladesh Textile Mills Association (BTMA) has urged the government to increase alternative cash incentives for the upcoming fiscal year from 4 per cent to 7 per cent to fight the economic fallout of the COVID-19 pandemic. As per Dhaka Tribune, the association also urged for a reduction in source tax to 0.25 per cent from the existing 0.50 per cent for the next fiscal year. It placed a set of demands to the National Board of Revenue (NBR) for the tax regulator's consideration ahead of the national budget in June, to help the textile sector turnaround from the pandemic.

Due to the devastating impact of the pandemic, 4 per cent alternative cash incentives is not enough for the sector, says Mohammad Ali Khokon, President, BTMA. After the LDC graduation, there will be new challenges for the sector due to erosion of duty benefits enjoyed as a least developed country, he added.

Export earnings from the apparel sector have witnessed a negative growth due to the pandemic, which also hit the backward linkage industry badly, Khokon added. In the given context, the government should set source tax at 0.25 per cent for the next fiscal year, he said.