Digital marketing to come under tax net
The government plans following in Europe's footsteps to tap digital marketing's popularity, with Finance Minister AMA Muhith yesterday proposing introducing provisions on taxing earnings of networking tech giants such as Facebook, Google and Youtube.
"Many foreign entities are making earnings in Bangladesh through virtual and digital transactions but we are not getting adequate tax from them," said Muhith.
People are progressively gathering on social media while increasing sophistication of algorithms means the ads can be accurately targeted.
Market sources said companies in Bangladesh were spending nearly Tk 1,000 crore every year on digital marketing, which was annually witnessing a triple-digit growth.
The Newspaper Owners' Association of Bangladesh has also raised their concern over absence of the tax measures.
It wrote letters to ministries, Bangladesh Bank, the National Board of Revenue and Bangladesh Telecommunication Regulatory Commission, saying Facebook and Google have no offices in Bangladesh and remain out of the purview of the country's laws.
A top digital company of Dhaka, requesting anonymity, said it was waiting to learn about the government plans, for those might increase their business costs.
"Some countries are taking up measures…but it will be very tough to bring in all the tax as the tech giants have no physical presence here…the government needs to look into it," said one of its top officials.
European policymakers announced plans in March to earn about $6.2 billion through such taxation.