The Bangladesh Textile Mills Association (BTMA) and other industry leaders have issued a one-week ultimatum to the government to withdraw the recently imposed 2% Advance Income Tax (AIT) on cotton imports, warning that failure to do so could force many textile mills to shut down.
Speaking at a press conference held at the Gulshan Club, BTMA President Showkat Aziz Russell criticized the government for implementing the tax without consulting industry stakeholders. “This 2% AIT will severely impact business viability and reduce government revenue in the long run,” he warned.
Industry leaders highlighted multiple challenges currently confronting the $23 billion primary textile sector, including:
High gas prices (Tk 32/unit vs. Tk 4/unit previously),
Soaring bank interest rates (now 15%),
Source tax at 1%,
Devaluation of the taka (from Tk 85 to Tk 122 per USD),
And growing dependence on Indian yarn imports, which benefit from significant Indian government incentives. Millers argued that the AIT would raise production costs by 7-8% and further erode thin profit margins, pushing many businesses toward insolvency. Leaders from BTMA, BKMEA, and the Bangladesh Terry Towel Association called for immediate relief and warned that restrictive policies could destroy Bangladesh’s primary textile backbone. They urged the government to revisit the decision and enhance support through incentives, competitive tax structures, and better infrastructure.
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