DHAKA, April 10, 2021 (BSS) – Businessmen and economists at a
pre-budget discussion today suggested the government for framing the
next budget for FY22 considering the 2nd wave of COVID-19 pandemic and
the fresh lockdown situation.
The businessmen also urged the government to take effective and
practical steps to continue production and domestic consumption in
this tough situation as well as saving the small and medium
enterprises from extinction.
They also called for reducing the tax and VAT rate at a rationale
level and also for pursuing a business-friendly revenue management
system.
The participants at the virtual pre-budget discussion called for
specific guidelines in the next budget for economic recovery as well
as called for striking a balance between revenue targets and
facilitating businesses.
Dhaka Chamber of Commerce & Industry (DCCI) in association with
Daily Samakal and satellite Channel 24 organized the discussion
FY2021-22 today virtually to outline the needs in the key
macroeconomic avenues and roadmap of trade, industrial, investment
recovery as well as turnaround of private sector from pandemic
adversities.
Dr. Mashiur Rahman, Adviser to the Prime Minister on Economic
Affairs and Chairperson, BRAC Dr. Hossain Zilllur Rahman joined the
discussion as special guests. DCCI President Rizwan Rahman chaired and
moderated the discussion.
The discussion meeting was divided into four sessions namely —
Financial Sector, Industry & Trade, Taxation & VAT and Infrastructure
(energy, logistics & health).
PM’s Economic Affairs Adviser Dr. Mashiur Rahman said that the
growth should be inclusive while the economy needs to be widened with
utilization of all the resources.
For government, he said, achieving revenue target without hampering
economic activities is a priority. He also suggested the stakeholders
to arrange budget discussions round the year.
Regarding tax regime, Mashiur said it should be a business friendly
one. “We should focus on increased revenue collection for development
as well as need to facilitate and incentivize businesses. However, if
revenue target is not achieved, development work will be halted,”
He also said that quality and safe investment will reduce default
loans adding a stable tax and duty regime for 7-10 years is a good
move, but all investors may not get this benefit as investments do not
come at the same time.
“Our tax-GDP ratio is comparatively low because our tax elasticity
is low in the country due to rebates in different levels. But, a
social acceptance of tax, VAT, SD and Customs duty rate need to be in
place having global standard,” he added.
The Adviser also said that frequent changes in tax rate may hamper
business growth. Rather, he suggested for increasing tax gradually
mentioning a minimum time frame.
Chairperson of BRAC Dr. Hossain Zilllur Rahman said that the 2nd
wave is going on and it may have a huge implication on the economy.
“The next budget should also have a plan for recovery as it was in the
last year. Moreover, social protection should get major concern in the
next budget,”
He said revenue collection and achieving the target is inevitable
for a budget at the same time the government must consider incentives
for the pandemic-hit the businesses specially the CMSMEs.
Zillur said disbursement of loan under stimulus for CMSMEs should
be faster and in that case mobile financial services can be engaged as
a delivery vehicle. “For the growth trajectory, domestic market needs
to be incentivized beside the export sector as the domestic economy
will be a growth driver,”
He said there is a need for transition from cheap labour economy to
skilled labour economy and a game changing policy review needs to be
famed.
“We have to focus on healthcare sector and we need more skilled
nurse. Urban poor are impacted heavily by the pandemic so budget needs
an allocation as well as urban primary health care needs to be
enhanced,” he added.
DCCI President Rizwan Rahman in his welcome address said that
government will surely consider a business friendly, revenue friendly
and industry friendly budget this year.
“And the budget will have a clear indication for the economic
recovery amidst the pandemic time. He also hoped that the next budget
will have especial attention to taxation and VAT policy,
infrastructure, industry and trade as well as financial sector,” he
added.
Rizwan said that if the government with the help of vibrant private
sector works hand in hand, Bangladesh will be able to recover its
economic momentum despite the pandemic.
Stakeholders from various sectors including Senior Partner, KPMG,
Adeeb Hossain Khan, Member, Customs Policy & ICT, NBR Syed Golam
Kibria, NBR Member, VAT, Masud Sadik, NBR Member, Tax Policy, Md.
Alamgir Hossain, CEO, IPDC, Mominul Islam, CEO, Standard Chartered
Bangladesh, Naser Ezaz Bijoy, Rahel Ahmed, CEO, Nagad, Asif Ibrahim,
Chairman, Chittagong Stock Exchange Ltd., Kazi Inam Ahmed, President,
Bangladesh Supermarket Association, Md. Fazlul Haque, Former
President, BKMEA, Md. Jashim Uddin, Vice Chairman, Bengal Group of
Industries, Dr. Md. Masudur Rahman, Chairman, SME Foundation, Md.
Faizur Rahman, CEO and MD, United Hospital Ltd, ASM Mainuddin Monem,
President, Private Economic Zones Association of Bangladesh, Professor
of BUET and Energy expert Dr. Mohammad Tamim, took part in the
discussion.
Abul Kasem Khan, Chairperson, BUILD said if employments could be
generated, additional tax rebate can be offered. He also suggested to
look into the matter of reducing effective tax rate that is sometimes
45-50%.
Acting Editor, daily Samakal, Mustafiz Shafi in his concluding
remarks said newspaper industry has to pay 37.5 percent corporate tax.
The industry also pays 5 percent duty while importing newspaper. He
thus wanted duty cut and reduction of corporate tax.