FICCI seeks simplified tax measures in budget proposal
The Foreign Investors' Chamber of Commerce and Industry (FICCI) has proposed simplification of taxation systems, including elimination of manual processes, to ensure compliance with laws and voluntary reporting.
This will increase revenue generation in Bangladesh, said the FICCI, a platform of foreign companies operating in Bangladesh.
Zaved Akhtar, president of the FICCI, placed proposals for the next fiscal year's national budget during a meeting with officials of the National Board of Revenue at the latter's headquarters in the capital's Agargaon yesterday.
The Metropolitan Chamber of Commerce and Industry, Dhaka also placed another proposal in the day seeking measures for businesses to effectively enjoy the 20 percent corporate tax rate.
Akhtar said the FICCI believes that there was a need for a comprehensive and integrated digital architecture for the country to track economic transactions and collect due taxes.
On behalf of the FICCI, he also highlighted the necessity for steps to be taken immediately for the integration of systems already available such as e-TDS, online return, e-TIN etc.
The TDS refers to tax deducted at source while TIN taxpayer identification number.
Regarding widening the tax net, he proposed enhancing coordination among government agencies and departments such as city corporations and land registration offices.
He also suggested bringing about an effective tax rate for increasing foreign direct investment, a unified VAT rate which would take value addition into consideration and fast resolution of impediments to imports and exports.
The FICCI, representing around 210 companies, has been contributing more than 30 percent of the total government revenue, he said.
To achieve "Vision 2041", Bangladesh needs to improve its tax to GDP ratio from 8.74 percent to 22 percent and, in this regard, the private sector's cooperation will be indispensable, said Akhtar.
The FICCI is eager to partner in this journey and committed to contribute for the progress of the people and the country, he added.
The coming fiscal year's budget is very important, said Kamran T Rahman, president of the Metropolitan Chamber of Commerce and Industry, Dhaka.
Due to post-Covid-19 situation, Russia-Ukraine war and rising prices of commodities, including oil, in the global market, the government needs special cooperation to overcome uncertainties in business and return to normalcy, he said.
In 2026, Bangladesh will gain middle-income or developing country status, resulting in the cancellation of certain benefits, include those over trade, he said.
Last fiscal year the corporate tax rate was reduced by 2.5 percentage points but the benefit can hardly be enjoyed for other limitations such as one involving cash transactions, said Rahman.
With expenditure and tax deduction at source being really high, the corporate tax rate of 20 percent effectively goes up to range from 40 percent to 50 percent depending on the sector, he said, requesting remedial measures.