Ceramic industry of Bangladesh has been going through a tough time since the outbreak of Covid-19 virus all over the world.
Bangladesh Ceramic Manufacturers and Exporters Association (BCMEA) has said that the proposed budget for fiscal year 2020-2021 has not reflected the association's proposal to the government.
The proposed budget has imposed 10 percent supplementary duty on all kind of ceramic sanitary products at production level.
Even in the last fiscal year, the supplementary duty was zero percent at production level. Now it has become a severe blow to the ceramic industry of the country.
So on June 16, BCMEA sent a letter to the National Board of Revenue (NBR) urging it to review the decision of the newly imposed supplementary duty in the proposed budget and withdraw it.
They wrote in the letter that the decision would make the local industry more vulnerable. "The imposition of 10 percent supplementary duty at the production level will increase the production cost by 11.5 percent," the letter said.
"The companies are currently paying 15 percent VAT. After adding the 10 percent supplementary duty, it will be a total of 26.5 percent VAT," it read.
BCMEA also thinks that the decision is going to put domestic products into an uneven competition with imported goods.
They fear that the investment in the industry might be hurt with the imposition of the supplementary duty as it will trigger the prices both in domestic and international markets.
They also made two other demands in the letter.
In the proposed 2020-21 budget, there is a proposal to replace a sub-section of VAT Act of 2012, which, BCMEA thinks, is helping producers of all sectors, including ceramics. It is also helping avoid financial losses.
The industry leaders proposed in the letter to not replace the previous law.
The last proposal mentioned in the letter was to reduce duty on certain raw and essential materials, mostly chemicals, at the import level. BCMEA had been demanding this facility for a long time.
"The chemical imported for using in the decoration of tableware is not produced in the country and the consumers do not use it directly," the letter said.
Sixty-eight BCMEA members, manufacturing ceramic tableware, tiles and sanitary ware, are helping the country save around Tk5,000 crores annually through supplying the products to the local markets.
Besides, they export goods worth over Tk400 crore annually.
The sector has a total investment of Tk8,958.70 crore and it showed 200 percent production growth in the last 10 years, according to BCMEA.