DHAKA, June 5, 2021 (BSS) – The Institute of Chartered Accountants of Bangladesh (ICAB) today termed the proposed budget for FY22 as a timely and comprehensive one aiming for a strong future with a focus on livelihood.
The ICAB came with such remarks at a press conference today on the proposed national budget through virtual platform.
ICAB President Mahmudul Hasan Khusru delivered the address of welcome in the press conference while Md. Shahadat Hossain, Council Member-ICAB and Snehasish Barua jointly delivered the conference paper.
Md. Humayun Kabir moderated the programme, said an ICAB press release.
Finance Minister AHM Mustafa Kamal placed the Taka 6,03,681 budget for FY22 on Thursday with a GDP growth target of 7.2 percent and also to contain inflation at 5.3 percent.
“Achieving such high growth requires integrated transition in all areas of the economy, which is difficult but not impossible,” said the ICAB leaders.
Terming the budget as ambitious, they said efficiency, transparency and accountability are essential for implementation, which is possible under the able leadership of Prime Minister Sheikh Hasina.
“We think that government spending will have to be increased even if we borrow now to keep the economy vibrant. Government spending should be increased in all sectors where domestic products and services are used,” they said.
As a result, the ICAB said employment in the country and the flow of money to the people will increase. At this moment, human life and livelihood should be given the highest importance, the said.
“We do not view the budget deficit as negative in terms of implementation capacity,” they viewed.
The ICAB said the Document Verification System (DVS) has been launched as a joint venture between the Institute of Chartered Accountants of Bangladesh (ICAB) and the National Board of Revenue. “As a result of this initiative, we believe that the taxpayer company will have transparency in the revenue projection which will contribute to the increase in revenue. We also appreciate the initiative to bring Nonfiler companies under income tax filing,” they added.
They said extensive economic activities are needed to mitigate the effects of the Covid-19 pandemic on the economy and increase investment to create jobs for the unemployed. The reality is that as long as the Covid-19 epidemic is in the country, there will be no significant investment and no increase in employment, they said.
Therefore, they said according to the government’s plan to revive the economy, 80 percent of the population must be vaccinated at any cost.
The ICAB stressed the need for increasing allocation in the social security sector considering the fact that a large number of people in the country are falling below the poverty line due to general holidays, lockdowns, job cut in manufacturing companies, shut down business activities at different times due to Covid-19 global pandemic.
The ICAB said the proposal to reduce the tax rate of one person company by 25% is reasonable.
It also termed the move as commendable to reduce the tax rate of listed companies from 25 percent to 22.50 per cent and for non-listed companies from 32.50 per cent to 30.00 per cent.
The ICAB proposed for withdrawing this tax hike proposal on the MFS services in order to attract more customers to MFS services during the ongoing Covid so that a cashless society can be established.
The Institute lauded the move to ensure employment, quality of life and social and economic security for people of transgender and people with disabilities. “We also believe that raising the tax-free income limit for women entrepreneurs from the current Taka 50 lakh to Taka 70 lakh will benefit the women entrepreneurs and small and medium enterprises (SMEs) sector in the country,” it said.
The ICAB said increasing tax deduction rate at source is likely to have an adverse effect on commodity suppliers and infrastructure companies.
It said the ambiguity of the Value Added Tax Act has been removed in order to clarify the issue of zero VAT in the export of services outside Bangladesh.
The ICAB applaud the proposal to make it mandatory for limited companies to submit annual financial statements for the purpose of VAT audit.
However, it proposed to include the use of Document Verification System (DVS), a joint venture between the Institute of Chartered Accountants of Bangladesh (ICAB) and the National Board of Revenue, to verify the accuracy of the annual financial statements. “With this initiative, transparency will come in the company’s annual financial statements which will contribute to the collection of VAT,” it said.
The ICAB also welcomed the proposal to include chartered accountants as authorized representatives and customs consultants in the Customs Act.
The Institute also welcomed the proposal to increase the perimeter of Bangladesh customs-waters from 12 nautical miles to 24 nautical miles. “As a result of the conquest of the sea, this addition has been epoch-making,” it said.