Bangladesh Economic Zones Authority (BEZA) has taken a plan to provide 100 percent tax waiver for 15 years for the investors in the G2G (government to government) economic zones (EZs) if they invest in the export oriented industries and transfer technology or re-invest.
To this end, the authority has already sent a proposal by redesigning its various incentive packages to draw foreign direct investments (FDI) to negate COVID-19 pandemic onslaughts on national economy, keeping an extra eye on prospective sources in the South-East.
“For our tireless efforts, investors from many countries, including China, are coming to Bangladesh. To attract more investment, we have set out a series of proposed measures to redesign the incentive package for post-COVID FDI flow,” Bangladesh Economic Zones Authority (BEZA) executive chairman Paban Chowdhury told.
The BEZA chief said his office sent a proposal to the Prime Minister’s Office (PMO) in May this year to attract new FDI, analysing moves by other regional FDI receiving competitors, while it is now awaiting a decision by the PMO.
He informed that BEZA proposed that companies which would invest US$100 million or create 300 employments would get 100 percent tax benefit for seven years from the Bangladesh government.
“If any investor invests $200 million or create over 300 employments, BEZA has proposed to provide 100 percent tax holiday for 10 years,” he added.
He said BEZA has also proposed complete corporate tax waiver and duty-free facility on importing all machineries and equipments for the investors who would like to relocate their investment in Bangladesh for production in export oriented industries from other countries under G2G basis economic zones.
BEZA has also proposed to allow factory relocation from other countries to Bangladesh, he added.
The BEZA chief informed that currently BEZA is working with some Japanese investors who were planning to relocate their investment from China due to coronavirus pandemic.
Paban Chowdhury said they also recommended reducing corporate tax to 25 from the existing 32.50 percent for investors while VAT rate to 12 from 15 percent.
He said they proposed to withdrawal VAT on land lease agreement for the both local and foreign investors in the country.
The BEZA chief urged the government to provide cash incentive for the backward linkage industries mentioning that India has allocated $3.6 billion cash incentive for the industries to overcome the impact of COVID-19.
BEZA also proposed 100 percent tax holiday for the high value product industries, like medical equipments, for 7 years.
BEZA also suggested providing 100 percent tax holiday for the first 5 years and 50 percent tax holiday for the next 5 years for setting up innovation or research or training institute, he added.
He said the authority also recommended 10 years tax holiday for setting up export oriented industries in remote areas and 20 percent cash incentive for agro product industries.
Mentioning that India is providing such subsidies, he urged the government to provide 50 percent subsidies of setting up central effluent treatment plant (CETP).
For the existing unit investors (except edible oil, sugar, flour, cement, iron and iron related products), he informed that BEZA is providing 100 percent Income Tax exemption for the first three years, 80 percent for the 4th year, 70 percent in 5th year, 60 percent in 6th year, 50 percent in 7th year, 40 percent in 8th year, 30 percent in 9th year and 20 percent in 10th year.
BEZA has recommended providing 100 percent income tax exemption for the first four years, he added.
The BEZA chief, however, said compared to its regional competitors, Bangladesh was in an advantageous position in offering online service through the One Stop Service (OSS) Centre.
BEZA is now providing a total of 125 services under OSS centre. Out of the services, investors are getting 20 services through online.