The association sought government policy support in the upcoming budget.
Around 400 RMG units have closed over three years, according to the BGMEA, which recently cautioned that many more factories remain financially vulnerable.
Exports have been falling since August 2025, implying factories are unable to operate at optimal capacity, it noted.
BKMEA said the RMG sector is facing an unprecedented crisis due to falling export earnings, lower purchase orders and rising costs.
Presenting a set of proposals at a pre-budget discussion meeting with the National Board of Revenue (NBR) yesterday, BGMEA president Mahmud Hasan Khan said exports have been falling since August 2025, implying factories are unable to operate at optimal capacity. As a result, fixed costs and other operating expenses have risen proportionately.
Representatives from other textile and garment industry bodies were also present at the meeting.
Among BGMEA’s proposals are exemption from a 10-per cent income tax deduction at source on cash incentives, reduction of tax at source on export proceeds from 1 per cent to 0.65 per cent for five years, duty benefits on raw materials for solar photovoltaic systems and tariff benefits on various raw materials.
Other concerns were lending interest rates reaching between 12-15 per cent, a rise in energy prices and energy security, according to a domestic media outlet.
The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) said the country’s RMG sector is facing an unprecedented crisis due to falling export earnings, lower purchase orders and rising costs. Domestic operational challenges are hampering industrial activities.
BKMEA data showed net garment export earnings fell by 6.42 per cent year on year (YoY) up to March of fiscal 2025-26 (FY26). Exports have been declining continuously since August 2025. As a result, factories are unable to run at full capacity, while lower production levels are increasing fixed costs and putting enterprises at risk, BKMEA said.
Despite regular tax payments, advance income tax cannot be properly adjusted, increasing the overall tax burden, it noted.
Rising operational costs and the lack of an investment-friendly environment have also led to stagnation in the sector.
Bangladesh Textile Mills Association (BTMA) president Shaukat Aziz Russell termed imposing tax on incentives inappropriate.
He said a 1-per cent tax is already imposed on export earnings, while additional taxes are paid at different stages, but are not carried forward to the following year.
BTMA’s other proposals included ensuring monthly refunds of VAT and advance tax for export-oriented industries and exemption of VAT and tax on LPG used in export-oriented industries.
Fibre2Fashion News Desk (DS)
