Cuts in taxes, predictable policy regime, tax simplification and boosting CMSMEs are among measures leading businesses seek in new budget for ensuring a business-friendly climate in the country.
They demanded Thursday a clear indication of improving ease of doing business with such measures to facilitate 'enthusiastic and aggressive' entrepreneurs growing further.
At the same time, the business leaders also recommended allowing tax refund, widening tax net instead of increasing tax burden on the honest taxpayers and skipping the provision of AIT (advance income tax).
Bangladesh's largest taxpayers raised these issues at a live pre-budget discussion from the private-sector perspective jointly organized by Dhaka Chamber of Commerce and Industry (DCCI), Samakal and Chanel 24 at Bangabandhu International Conference Centre (BICC).
Dhaka Chamber President Rizwan Rahman moderated the discussion which Planning Minister MA Mannan attended as the chief guest.
Speaking as a special guest, eminent businessman and chairman of Apex Group Syed Manzur Elahi said the country needs to improve ease of doing business and reduce cost of doing business for a conducive trade-and-investment ecosystem.
"If doing business is eased, foreign direct investment (FDI) will come and local entrepreneurs will get an opportunity to grow further," he says.
Mentioning the importance of SME sector, Mr. Elahi, also former adviser of a caretaker government, notes that SMEs are the backbone in the developed countries like Germany and the USA. "Not the large industries, it is the SMEs. We need to facilitate this promising sector for creating jobs here," he adds.
DCCI president Rizwan Rahman urged reduction in tax on income of corporate dividends from existing 20 per cent to 10 per cent. An integrated tax-administration system is crucial for a simplified tax- management system, he says.
In order to strengthen CMSMEs, he proposed introduction of turnover-based loan instead of collateral-based loan for the CMSME sector.
Talking about FDI benefits, he said the foreign investment is not required only for money. "We want technology transfer, technical expertise, high-value RMG products and so on," he adds.
President of the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI) Md. Saiful Islam said the corporate tax for listed and non-listed companies is 22.5 per cent and 30 per cent respectively, which are much higher than the average global corporate tax rate.
"The effective tax rate is more than 50 per cent if we take tax at source into account. So, we propose a cut of 2.5 per cent in corporate tax in the coming budget," he adds.
He was also suggesting a provision of tax refund like in many other countries in the national budget for fiscal year 2022-2023.
Former member of the National Board of Revenue (NBR) Alamgir Hossain told the meet that the issue of tax at source needs to be considered. Companies still pay tax at source at the rate that they paid when the corporate tax rate was 35-37 per cent.
"So, the effective tax rate keeps growing. It needs to be addressed," he adds.
Former DCCI president Asif Ibrahim said they feared that the rate of inflation would cross 7.0 per cent for many reasons, including the Russia-Ukraine war. "We demand of the NBR not to fix the revenue- growth target over 30 per cent in the coming budget."
Lawmaker and former FBCCI president Md. Shafiul Islam Mohiuddin said CMSMEs should have access to the funds of the stimulus even though having some compliance issues of them.
He thinks policy consistency is more important for a sustainable economic development. Later, he emphasized formulation of a business- and tariff-friendly budget.
FBCCI president Md. Jashim Uddin called upon the NBR to consult the private sector prior to changing any rules or SROs because sudden changes sometimes become a hassle for the business community.
He also says that the government should facilitate sub-contracting to boost backward-linkage industry. He also urges ease of doing business, local industry development and poverty alleviation.
Vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Md. Shahidullah Azim said the country could adopt pro-export policies of Vietnam to facilitate export.
"We don't want short-term policy. We want policy that would be for at least five years," he said, requesting the revenue board to address H.S Code-related concerns badly hurting the exporters.
Chairman and managing director of Meghna Group of Industries Mostafa Kamal said the businesspeople are very enthusiastic and aggressive here. "They need policy support and favourable business climate."
Alongside policy continuation and product diversification, he called upon the government officials at various levels to improve their mindset towards the local entrepreneurs.
Vice Chairman of Shanta Asset Management Ltd. Arif Khan said that for a long-term financing there should be a sustainable bond market. He also said that renowned big companies should be listed on the capital market and it will encourage others to come forward.
President of Foreign Investors' Chamber of Commerce and Industry (FICCI) Naser Ezaz Bijoy also urged capital-market development and sovereign bond market. He also requested redefining the definition of SMEs.
"The looming problem in the banking system is there is a potential stagflation that is going to happen. It needs to be addressed in the coming budget," said Mr. Bijoy, also CEO of Standard Chartered Bangladesh.
Planning Minister M A Mannan said that the aggressiveness of the businessmen is appreciable and positive sign for the economy. All the government agencies have to play their respective roles in a friendly manner while providing services.
He also said that government should give more priority in the infrastructure sector. Government is committed to work hand in hand with the private sector in order to be competitive in the world.
Bangladesh bank chief economist Dr. Md. Habibur Rahman, , Deputy Managing Director of Ifad Group Taskin Ahmed, Vice President of Bangladesh Independent power Producers Association Navidul Haque, Managing Director of Expo Group Mahbubul Anam, Vice President of Bangladesh Economic Zone Investors Association M A Zabbar, Chairman of Alliance Holdings Ltd. Syed Ali Jowher Rizvi and acting editor of Samakal Mozammel Hossain, among others, also spoke in the pre-budget discussion.
