Md Asaduz Zaman

Backtracking on its promise to eliminate black money, the government has once again made room to allow both individuals and companies to whiten money without facing scrutiny and by paying a 15 percent tax, a move that drew sharp criticism from economists and civil society.

Experts and businesspeople also highlighted the challenges linked with the current tax and incentive system.

For air conditioner and refrigerator manufacturing industries, the government plans to extend the existing facility to June 2026, according to the finance ministry.

Inflation, fuelled by higher food prices, climbed 15 basis points to 9.89 percent in May from 9.74 percent a month earlier, figures from Bangladesh Bureau of Statistics showed yesterday.

In FY22, the spending on public services increased to 15 percent of the total actual expenditure, nearly double the rate in FY09. Similarly, spending on the transport and communication sector surged to 12 percent from 4.7 percent in FY09.

Government spending under the Annual Development Programme (ADP) slowed to a three-year low in the first 10 months of the current fiscal year (FY) of 2023-24, with the implementation rate dropping to 49.26 percent.

Although a large chunk of revenue is deposited in the state coffer towards the end of a fiscal year, there might be a big gap between the revised target and the actual collection.

In the coming year, the NBR may announce tax rates that will not only be applicable for the outgoing income year 2023-24 but also for the next income year 2024-25.

According to a provisional estimate of the Bangladesh Bureau of Statistics (BBS), consumption of goods and services grew 3.53 percent in 2023-24, up from 2.52 percent in the last fiscal year.

The government is planning to reduce duties on imported laptops next fiscal year in order to make the devices more affordable and bring relief to freelancers and students.

The National Board of Revenue (NBR) is likely to introduce self-assessment for companies from 2024-25 to allow them to determine their own tax liabilities and cut reliance on taxmen.

Investors in the economic zones and hi-tech parks in Bangladesh may see an end to the zero-duty benefit on imports of capital machinery, components and construction materials next fiscal year.

Mobile phone calls and metro rail commutes among other daily activities may cost more in the next fiscal year as the government looks to increase taxes to boost its revenue collections.

The National Board of Revenue seeks to impose 25 percent import duty on cars for lawmakers, reversing a practice of tax exemptions that amounted to Tk 5,147 crore over the last 15 years.

However, the findings raised questions among economists, who were puzzled by the growth at a time when the economy had been facing a slowdown due to high inflation, a downtrend in export growth, and falling imports.

Of the over 7 crore people employed in Bangladesh, 85 percent (nearly 6 crore) are vulnerable as they work in the informal sector, which lacks basic social and legal protection, and employment benefits.

It recommended the National Board of Revenue (NBR) discontinue the tax holiday for the information and communication technology industry and abolish the tax benefit for mining and petroleum extracting companies.

Development spending rose 42.30 percent in the first nine months of the current fiscal year (FY) thanks to a higher execution rate in March following the national election.

Bolstered by rising value-added tax (VAT) collection and increased income tax receipts, the tax administrator logged Tk 259,866 crore in total revenue in the July-March period of the current fiscal year, according to the NBR’s provisional estimates.

The National Board of Revenue will likely propose reducing the tax on corporate profits by 2.5 percentage points for both listed and non-listed companies.