Proper coordination of monetary, fiscal policies needed
There should be proper coordination between the monetary policy and the fiscal policy to help the economy ride out the current challenges, said Md Sameer Sattar, president of the Dhaka Chamber of Commerce and Industry (DCCI).
The business leader said the tax net has to be expanded and the National Board of Revenue (NBR) will have to identify people with taxable incomes beyond Dhaka and Chattogram.
He welcomed the NBR's move to set up tax offices across the country. "Skilled officials should be employed there."
Sattar said the full automation of the tax administration and processes should be completed to raise the country's tax-to-GDP ratio, which is one of the lowest in the world.
The DCCI chief recommended raising the tax-free income limit to Tk 5 lakh from the current Tk 3 lakh.
Sattar thinks there should be a focus on promoting import-substitute industries so that manufacturers can produce them locally.
"Import-substitute industries can help Bangladesh go a long way in reducing the demand for imported items and saving the foreign currency reserves."
He called for reducing the corporate tax rate, saying the NBR is bringing down the rates of nominal corporate taxes but it should take steps to cut the effective tax rates.
"And conditions should be conducive so that businesses can reap the benefit of any corporate tax cuts."
He urged the government to set aside US dollars to help businesses open letters of credit in a bid to import essential goods and commodities consumed by the public and the inputs and machinery used by factories.
The government should withdraw or waive duties, where applicable, on the imported essentials so that their prices come down in the local markets, he said.
A market monitoring cell should be there to ensure essential commodities and goods are sold at logical prices, curb hoarding, and keep the supply chain smooth, Sattar added.