Stakeholders and experts at a pre-budget discussion on Saturday called for a specific guideline in the next budget for economic recovery as the second wave is going on and it may have a huge implication on it.
Terming revenue collection and achieving the target as inevitable for a budget, they added at the same time the government must consider incentives for the pandemic-hit businesses especially the local cottage, micro, small and medium enterprises (CMSMEs).
Dhaka Chamber of Commerce & Industry (DCCI) in association with Samakal and Channel 24 organised the pre-budget discussion of FY22 virtually to outline the needs in the key macroeconomic avenues and roadmap of trade, industrial, investment recovery as well as turnaround of the private sector from pandemic adversities.
Dr. Mashiur Rahman, Adviser to the Prime Minister on Economic Affairs and Chairperson of BRAC Dr. Hossain Zilllur Rahman joined the discussion as special guests. DCCI President Rizwan Rahman chaired and moderated the discussion.
The discussion meeting was divided into four sessions namely, (1) Financial Sector (2) Industry & Trade (3) Taxation & VAT and (4) Infrastructure (energy, logistics & health).
DCCI President Rizwan Rahman in his welcome address said that the government will surely consider a business-friendly, revenue friendly and industry-friendly budget this year.
Terming that the budget will have a clear indication for the economic recovery amid the pandemic, he also hoped that the next budget will have special attention to taxation and VAT policy, infrastructure, industry and trade as well as the financial sector.
If the government with the help of the vibrant private sector work hand in hand Bangladesh will be able to recover its economic momentum despite the pandemic, the DCCI President said.
Dr. Mashiur Rahman, Adviser to the Prime Minister on Economic Affairs said the growth should be inclusive side by side economy needs to be widened all the resources should be utilised.
For government, revenue target achieving without hampering economic activities is a priority, he said.
He also suggested stakeholders arrange budget discussions all year round.
Regarding tax regime, he said it should be a business friendly one.
The country should focus on increased revenue collection for development as well as needs to facilitate and incentivise businesses.
However, if revenue target is not achieved, development work will be halted down, he added.
He also said quality and safe investment will reduce default loans. A stable tax and duty regime for 7-10 years is a good move but all investors may not get this benefit as investments do not come at the same time. Our tax-GDP ratio is comparatively low because our tax elasticity is low in the country due to rebates in different levels. But, a social acceptance of tax, VAT, SD and Customs duty rate need to be in place having a global standard.
He also said that frequent changes in tax rate may hamper business growth rather he suggested a gradually increase of tax mentioning a minimum time frame.
Chairperson of BRAC Dr. Hossain Zilllur Rahman said that social protection should get a major concern in the next budget.
Disbursement of loan under stimulus for CMSMEs should be faster and in that case mobile financial services can be engaged as a delivery vehicle, he points out.
For the growth trajectory, the domestic market needs to be incentivised besides the export sector as the domestic economy will be a growth driver, Mr Zillur said.
Stakeholders from various sectors also took part in the discussion.
sajibur@gmail.com