Ctg chamber wants a raise in tax-free income limit

The Chittagong Chamber of Commerce and Industry (CCCI) has proposed an increase in the tax-free income limit for individuals, women, the elderly, physically-impaired and freedom fighters in the next national budget, considering the adverse impacts of the ongoing pandemic.

The chamber proposed that the tax-free income limit should be raised from Tk 3 lakh to Tk 4 lakh for individual taxpayers, Tk 3.5 lakh to Tk 4.5 lakh for women and elderly taxpayers above 65 years of age, Tk 4.5 lakh to Tk 5.5 lakh for the physically challenged taxpayers and Tk 4.75 lakh to Tk 5.75 lakh for war-injured freedom fighters.

CCCI President Mahbubul Alam yesterday placed its 14-point proposal in a pre-budget meeting organised by the chamber at the World Trade Centre in Chattogram.

National Board of Revenue (NBR) Chairman Abu Hena Md Rahmatul Munim was the chief guest at the meeting.

The next budget is vital for the nation, which is progressing ahead even after facing pandemic-induced losses, the CCCI president said.

Apart from boosting the country's economy by creating employment through investments in industrialisation, everyone needs to be proactive about achieving the targeted revenue collection, he said.

Alam emphasised the need to focus on poverty alleviation, employment creation, investment enhancement and increasing revenue collection while formulating the upcoming budget for fiscal 2021-22.

In his speech, the NBR chairman said the government imposes tax with an aim to develop local industries, production and agriculture, achieve self-reliance as well as protect the environment.

Capable people should pay tax duly and play a role in the country's socio-economic development, he said.

The chamber also proposed for taking steps to expedite tax refunds as a huge amount of money paid as 5 per cent advance tax (AT) on imports by the steel sector industrialists remain held up at the revenue department.

Mentioning that the AT is mandatorily adjusted within six months during marketing and sales, the chamber proposed cutting short the time for refunding the money to 60 days.

Raising the issue at the meeting, BSRM Group General manager (Finance and Accounts) Shekhar Ranjan Kar demanded lowering the AT rate on imports to 1 per cent from the existing 4 per cent.

Kar later told The Daily Star that his group is not getting AT refunds worth around Tk 140 crore from the government since July 2019. 

The CCCI proposed cancelling the amendment in section 52 U (3) of the Income Tax Ordinance regarding the imposition of 2 per cent tax at source on local letters of credit for the purchase of commodities such as rice, wheat, onion, garlic, lentil, ginger, date, flour, salt, edible oil, sugar and computer accessories with an aim to keep the market stable.

In case of loan defaults by one or two concerns of a particular business group, its other profitable units are usually barred from getting bank funds, which actually leads those capable concerns to become losing ones and eventually the whole group becomes a defaulter.

So, the chamber proposed amending the law in this regard by keeping the rest of the profitable concerns of a group out of the purview of ceasing the flow of funds.

Pointing to the matter that businesses failed to make their expected profit due to pandemic, the chamber also placed a proposal for exempting fines in case of delays in paying quarterly tax on last year's tax return.

Other proposals include lessening the duration of realising advance tax for vehicles' tax token from two years to one year, bringing down rates of VAT to single digit and fixing sector wise VAT rates and cancellation of 5 per cent VAT in retail sales of LPG cylinders.

CCCI Director AKM Akhter Hossain; former director Mahfuzul Hoque Shah; BSRM Group Chairman Abul Bashar Chowdhury; Confidence Cement Managing Director Zahir Uddin Ahmad; REHAB President Abdul Qaium; Clearing and Forwarding Agents Association General Secretary Altaf Hossain; and leaders of Cox's Bazar, Bandarban and Rangamati chambers spoke among others.