(1) The Bank, through which export proceeds of goods of an exporter is received, shall deduct tax at the rate of 1% (one percent) of total export proceeds at the time of crediting the proceeds to the account of the exporter and deposit it in the Government treasury.

(2) Where the Board, on an application made in this behalf, gives a certificate in writing that the income of the exporter is fully exempted from tax or taxable at a reduced rate under any provision of this Act, the Bank shall make credit to the account of an assessee without any deduction of tax or with deduction of tax at a reduced rate so specified in the certificate for the period specified in the certificate and deposit the same to the Government Treasury.