Finance Minister AMA Muhith yesterday hinted that tax-free income ceiling for individuals might be fixed at Tk2.25 lakh in coming fiscal year.
“Personal income tax limit can be increased by Tk5,000,” he said, exchanging views with the Economic Reporters’ Forum (ERF) on the upcoming national budget for 2014-15 likely to be placed in parliament on June 5.
Presently, a personal income of up to Tk2.20 lakh is free from tax.
Earlier, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) proposed to raise the tax-free income threshold to Tk2.5 lakh for individuals in consistent with the increased living cost.
On the latest situation of foreign investment in the country after January 5 general elections, he said “I’m very happy. They’re (foreign investors) coming. They’ve come back in a big way in about three months.”
About local investment, he said the local businessmen have refrained from further investment in the country for lack of confidence. “I don’t know how far is it true? ”
His comment came after the Centre for Policy Dialogue (CPD) in its pre-budget recommendations for the next fiscal year said lack of security has shaken investor confidence.
The local think tank said some recent non-economic concerns like security of assets and personal lives have further shaken investors’ confidence, which prompted investors to shelve their fresh investment and business expansion plans.
Muhith further explained his view further saying: “The matter – lack of confidence – I don’t understand this because at this moment Bangladesh is a very good market.”
On allowing whitening untaxed money or black money in the next budget, finance minister outright rejected the proposal and said, “it is useless provision. The government did not collect enough tax money in its exchequer during the last 40 years through allowing black money to whiten.”
On capital market, Muhith said the capital market witnessed stability. “It has been government’s primary goal to see investment through the capital market. Now, I believe, investment will come in the capital market.”
He also expresses his determination about offloading shares of state-owned enterprises (SoEs). “It has remained pending. This will be done this time. We’ve started the process,” he said.
On demand of cutting lending rate by the business community, the Finance Minister said they do not fix the interest rate rather market determines it. “Many businessmen complained about higher interest rate, but they forget it when they sit in the bank’s board of directors.”
About PPP (public-private partnership) initiative, he admitted the initiative did not see much success. “I’ve a plan … we’ll build a large convention center somewhere in Keraniganj and Mawa. There will be a link road from airport to Keraniganj to be built under PPP.”