Finance Minister AMA Muhith has hinted at corporate tax cuts in the next budget.
He made the comments while speaking as the chief guest at a pre-budget discussion organized by Dhaka Chamber of Commerce and Industry (DCCI) at the Bangabandhu International Conference Center (BICC) on Saturday.
The minister said that the government is considering slashing corporate tax rates and encouraging the youth to pay more income tax.
The government is planning on a double-slab VAT rates system for the FY2019-20 instead of the 15% flat VAT rate that is currently in place.
“To attract foreign direct investment, Bangladesh Investment Development Authority (Bida) has opened 'One Stop Service Window’ where investors will be get all related services for a maximum of seven months,” he also said.
Muhith added: “It is true that at present the rate of interest on the national savings instrument is a bit high compared to other non-government savings instruments. The government will review the rates after the announcement of budget this year.”
The finance minister also said that to ensure fare competition among the companies in Bangladesh, an effective enactment of competition law is necessary. He agreed that the government could not bring the 26 state-owned enterprises in the capital market due to its instability.
DCCI President Abul Kasem Khan in his welcome address said certain things need to be prioritized such as policy reforms, simplification of taxation system, business friendly policies, enabling business climate, policy continuation, ease of doing business, incentives, reduction of taxes and inclusive policy planning.
At the discussion, Dr Ahsan H Mansur said that the country's tax-GDP ratio has not increased over the past seven years and it quite low in South Asian countries. He said taxation system in the country needs to be automated.
Economist and Managing Partner of PricewaterhouseCoopers Mamun Rashid said that at present Bangladesh spends 2% of its GDP in infrastructure sector which needs to accelerate to 10%.