‘There is no alternative to expanding the tax net to increase the tax-GDP ratio’ – 2024-02-15 12:50:46

Dhaka Chamber of Commerce and Industry (DCCI) has emphasized on simple and business-friendly income tax system, increasing the scope of income tax and VAT, complete automation of tax system, encouraging local industrialization and ensuring an investment-friendly environment to achieve economic growth targets in the next budget.

In the pre-budget discussion held at the National Board of Revenue (NBR) conference center on Wednesday (February 14), DCCI President Ashraf Ahmed NBR Chairman Abu Hena Md. Rahmatul presented the proposal for the new financial year to Munim. On this day, Dhaka Chamber submitted a total of 40 proposals related to income tax, customs and duties to NBR for the national budget of 2024-25 fiscal year.

DCCI president Ashraf Ahmed said, ‘According to NBR data, there are about one crore tindhari in the country. About 3.2 lakh tax payers paid revenue in FY 2022-23.’ He emphasized on the increase of tax net in order to increase the direct tax.

The President of Dhaka Chamber said, “According to Section 70 of the Income Tax Ordinance, business losses can only be reconciled with income from business.” In this context, he recommended the reinstatement of Section 37 of the Income Tax Ordinance of 1984. As a reason for this, Ashraf Ahmed said that the tax burden on businessmen will be reduced to some extent. Ashraf Ahmed proposed to declare similar tax exemption for government employees on income arising from provident fund, gratuity fund, superannuation fund and pension fund of private institutions. Besides, since interest payments on foreign loans to the private sector are tax-deductible at source under the Income Tax Act, the cost of such loans will increase and foreign investment and credit flows will decrease. In such a situation, he proposed abolition of tax at source on payment of interest on foreign loans.

Besides, the DCCI President called for the introduction of an Integrated Tax Administration System (ITAS) to bring all tax related matters under the ambit of automation. Through which any issue related to tax payment and tax can be solved easily. The cost of supply of goods has increased largely due to rising inflation. In the existing context, he proposed to increase the upper limit of turnover of traders outside the ambit of VAT from 3 crores to 4 crores. He pointed out that appeals, credit refunds and risk management among VAT procedures are yet to be done online. It is recommended to complete the mentioned matters in the VAT online process as soon as possible. DCCI president proposed withdrawal of at-source deduction for domestic solar panel manufacturers to boost investment in renewable energy sector. Besides, the President of Dhaka Chamber insisted on waiving the 5 percent advance tax deducted from the traders at the import level, or coordination and resolution of complications at the earliest.

Chairman of National Board of Revenue Abu Hena. Rahmatul Munim said, NBR formulates revenue policies by considering the issues of increasing revenue collection, prevention of money laundering, expansion of local industrialization and preservation of markets and preservation of sustainable environment. The NBR chairman urged the businessmen to inform the NBR if they face obstacles while conducting business and investment activities. He said, based on this, NBR will take initiatives as always to ensure a business-friendly environment through necessary amendments.

DCCI Senior Vice President Malik Talha Ismail Bari, Vice President Md. Senior officials of the National Board of Revenue including Junaid Ibn Ali were present at the time.