Poultry breeders and feed millers, on 28th March (Sunday) demanded the government for a 10-year tax holiday to facilitate their recovery from Covid-induced losses.
In another proposal, agro-processors demanded a similar tax treatment for poultry and fish feed makers.
The Breeders Association of Bangladesh (BAB), Feed Industries Association of Bangladesh (FIAB) and Bangladesh Agro-Processors Association (BAPA) placed these recommendations for the fiscal 2021-22 budget to the National Board of Revenue (NBR).
“We need the tax break so that existing operators can sustain themselves and new entrepreneurs can come to the poultry industry, said BAB President Md Rakibur Rahman.
“We also aim to begin export by 2025,” he added.
Breeders suffered losses of around Tk 2,900 crore due to shortfall in demand for chicken amid Covid outbreak which began in March 2020.
Besides, breeders had to sell day-old chicken (DOC) for Tk 2-5 each against production costs of Tk 35-40 each, as the demand for restocking declined.
The decline in prices persisted until May as many farmers were even unwilling to get DOCs for free.
As many breeders even had to destroy their livestock due to an acute shortage of buyers, the BAB said in its appeal for a tax exemption until 2030.
People engaged in poultry farming enjoy reduced tax benefits. According to the NBR guidelines, no tax is applicable for incomes of up to Tk 20 lakh.
About 10 per cent tax is payable on incomes of over Tk 30 lakh from poultry farming whereas the highest rate of tax for an individual is 25 per cent.
Weekly production of broiler DOCs, which was 1.70 crore before the pandemic, now stands at 1.35 crore. In total, the poultry industry incurred nearly Tk 7,000 crore in losses, it added.
The BAB also urged tax-free imports of certain machinery used by the poultry industry as well as exemption of tariff and tax on imports of feed making materials.
Besides, BAPA recommended the elimination of 2 per cent tax at source on procurement of agricultural products.
It also requested for the removal of advance income tax on raw materials used by agro-processing factories.
However, FIAB said feed production dropped because of reduced farming.
Addressing the spiralling prices of feed making materials worldwide as well as increased container and freight charge, feed millers called for a 10-year tax holiday.
FIAB demanded a reduction of advance income tax on the import of these materials from 5 per cent.
It also wanted a removal of tax at source on the purchase of feed ingredients from the domestic market.