Economists on Tuesday urged the government to bring down consumer prices in the upcoming budget during a meeting with the National Board of Revenue (NBR).
Zaidi Sattar, chairman, PRI, said: “The next budget should try to help regular consumers because the cost of imported consumer products in Bangladesh is still much higher than the pricing in the international market.”
“The excessive protection being given to Bangladesh's local industries and the way supplementary duty has been increased in Bangladesh are non-compliant considering global standards. These have come out in the United States Trade Representative's report. These issues need to be rationalized,” he also explained.
While representatives from the garment sector called for no increase in corporate taxes, at the meeting.
They were speaking at a pre-budget discussion held at the NBR office in Dhaka's Agargaon on April 15.
Representatives from several organizations, including the research institute Policy Research Institute (PRI) and Bangladesh Economic Association (BEA), as well as organizations from the ready-made garment sector—Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), and Bangladesh Textile Mills Association (BTMA)—participated in the meeting with NBR Chairman Md Abdur Rahman Khan.
Professor Mahbub Ullah, president of BEA, proposed raising the tax-free income threshold from the current Tk3.5 lakh to Tk6 lakh.
RMG
At present, readymade garment (RMG) exporters pay 12% corporate tax, compared to the general corporate rate of 27.5%.
Representatives from the BGMEA, BKMEA, and BTMA urged keeping the current corporate tax rate unchanged for the apparel sector.
Enamul Haque Khan Bablu, former BGMEA director, said: “The price of gas has become Tk40. The industry will not survive if this continues. This is not the right time to increase corporate tax.”
On the other hand, the Bangladesh Textile Mills Association also demanded rationalizing the valuation of fabric imports and resolving complications related to HS codes and valuation.
Non-tariff barriers
In reply to the demands, NBR Chairman Md Abdur Rahman Khan said: “We’ll try to ease the non-tariff barriers for you (businessmen); we’ll remove all the hurdles from your path, and that is our main target. We’re working on that. Besides, work is also underway to resolve the existing problems in valuation and HS codes.”
Speaking at a pre-budget meeting, he added: “The ultimate objective of the revenue board is to enhance the revenue collection, widen the tax net further, and contain the revenue invasion, which is the main cause for revenue leakage.”
He also said that sometimes there is a huge gap between the tax rate and the effective tax rate. “We’ll try to ease that.”
“We have to reduce our tax expenditure to zero,” he added.
“It is high time to keep aside the tax exemption culture; there will be some tax exemptions, of course, but that will be for the sake of encouraging new investments,” he said.
Abdur Rahman Khan said they will address the issue of tariff rationalization in the upcoming budget.
