SMEs in Bangladesh seek withdrawal of 7 per cent tax deduction at source

Underlining in its proposal for the upcoming budget for the fiscal year 2023-24 that the 7 per cent advance income tax deduction levied on the sale of SMEs products is hampering the development of SMEs, the SME Foundation of Bangladesh have sought withdrawal of the existing 7 per cent deduction of income tax at source (TDS) on the sale of their backward linkage products.

This is as per media reports, which added in a letter written to the country’s National Bureau of Revenue (NBR), the SME foundation maintaining big industrial companies at present are more inclined towards building factories for the production of backward linkage products to avoid the advance deduction of income tax, and went on to add that this was a concerning for the existence of backward linkage enterprises in the country’s SME sector.

Meanwhile, speaking to the media, the Managing Director of the SME Foundation, Md Mafizur Rahman reportedly said in the given scenario it would be very difficult for the SMEs to survive if the big industries start manufacturing products that SMEs make.