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Trade support needs careful handling
- By Efazul Karim -- 6 minutes read --
- Feb 15, 24
" Revenue board chief tells Dhaka chamber delegates "
The government wants to provide facilities and enact policies that promote trade and industrialisation, but it must exercise caution to ensure these supports are not misused, according to the revenue board chairman.
"Businesses naturally seek government support and the government strives to provide it," National Board of Revenue (NBR) Chairman Abu Hena Md Rahmatul Muneem said on Wednesday. "However, there remains a tendency for such facilities to be abused."
Money laundering, he added, is a prime example of this abuse.
The NBR chairman acknowledged that while money laundering is widely discussed, implementing fully effective measures to combat it is tough, as strong action could hurt trade and investment.
"Harsh measures taken to prevent money laundering can impact businesses and investments and create additional barriers," he commented.
Mr Muneem made these remarks during a pre-budget meeting with delegates of the Dhaka Chamber of Commerce and Industry (DCCI) at his office in Agargaon.
He said NBR policies and guidelines consider various factors, including revenue growth, money laundering prevention, local industry development, local market protection and sustainable environmental protection.
DCCI President Ashraf Ahmed presented some 40 proposals to the revenue board chairman for the FY2024-25 national budget. DCCI Senior Vice President Malik Talha Ismail Bari and Vice President Md Junaed Ibna Ali were also present at the meeting.
The trade body urged the revenue authority to create a business-friendly tax regime, expand the tax and value-added tax (VAT) net, fully automate the taxation system, encourage local industrialisation and ensure an investment-friendly environment in the country.
DCCI proposals also included loss carry-forward, AIT adjustment, fund tax removal and loan source tax withdrawal.
The DCCI advocated for a comprehensive Integrated Tax Administration System (ITAS), similar to the existing Integrated VAT Administration System (IVAS), to fully automate the tax system. This, they believe, would attract more taxpayers and improve tax collection efficiency.
Agribusinesses seek VAT exemption, tax cuts
In a separate meeting with the revenue board chair on Wednesday, agribusinesses proposed value-added tax (VAT) exemption and tax reductions in the upcoming national budget.
They also called for trade organisations to be categorised as non-revenue entities, as these bodies primarily operate on membership subscription fees, with the majority of funds allocated to enhancing members' capacities.
Bangladesh Agro-Processors' Association proposed the withdrawal of tax at source for the acquisition of agro products from farmers. They also called for the elimination of advance income tax on raw materials used by agro-processing factories.
Besides, the association sought a "net-off" facility for source tax at the import level on supplies from manufacturing establishments.
The Feed Industries Association of Bangladesh (FIAB) called for a reduction in the advance income tax (AIT) on imported materials from 5 per cent to 0.5 per cent. They also advocated for the removal of tax at source on the procurement of feed ingredients from the domestic market.
Bangladesh Agro Feed Ingredients Importers and Traders Association demanded a five-year tax exemption on raw materials for livestock (poultry, dairy, and fish) feed.
They pointed out that custom duty (CD), VAT, AIT, and AT are currently imposed on these raw materials.
The Bangladesh Tea Association requested the reinstatement of the tea import duty at 89.32 per cent to protect the local industry. The association demanded for income tax of 10 per cent for both registered and unregistered public and private companies in the tea sector.
The Bangladesh Crop Protection Association also demanded a 10 per cent income tax for both registered and unregistered public and private companies to simplify the tax regime and create a level playing field for all industry players.
NBR Chairman Abu Hena Md Rahmatul Muneem emphasised the NBR's dedication to offering assistance to the agro-business sector, noting its significant role.
"The export of agro products is highly encouraging, and we are committed to providing the necessary support to expedite this growth", he affirmed.
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