ACCA believes that a clear exposition of what makes an efficient and just tax system in the 21st century is essential. As tax rises up the political agenda, ACCA revisits its ‘12 Tenets of Tax’ to take account of the wider tax landscape and the new pressures facing governments, said Prawma Tapashi Khan, head of Education, ACCA Bangladesh.
On June 12, a virtual roundtable on the government's proposed budget for the fiscal year 2021-22 was arranged by The Association of Chartered Certified Accountants (ACCA) in Bangladesh. Tapashi Khan presented 12 Tenets of Tax there, according to a release from ACCA Bangladesh.
The 12 tenets are: (1). A presumption to tax neutrality, (2). Openness and transparency, (3). Simplification, (4). Certainty, (5). Accountability and regular review, (6). Tax policy is a percentage of GDP, (7). Efficiency, (8). Tax shifting and hypothecation have a role to play, (9). Tax is a matter of national sovereignty, (10). Tax is subject to the rule of law, (11). Respect for Human rights and (12). Avoidance of double taxation.
Prawma Tapashi Khan said, “A presumption to tax neutrality- One individual party should not be favoured. It is not a good thing to give an advantage to a particular industry and a disadvantage to another. There must be openness and transparency in tax. Our income tax threshold was not changed but due to inflation, the purchasing power of money has decreased. Most countries’ tax systems suffer from the political positioning of the creation of tax policy. The tax has to be very simplified. Sometimes there’s an artificial block that affects many sectors. There must be a certainty.”
She also said, “Accountability and review should be a part of the tax system. There were changes due to the Covid situation. The health sector should have been given much priority. Probably for the shortcomings of the annual development plan of the previous year, the budget allocation was not increased. The tax has to be efficient.
Another point is tax shifting and hypothecation. This will be applicable to our country in the future when we become a much-developed country. Like carbon tax, less tax for green companies. The tax has to be a matter of national sovereignty, she added.
“Tax is subject to the rule of law. Tax separated from the rule of law is not acceptable. Tax avoidance is created when rule of law and the rule of taxation is not in unison. Human rights must be respected in taxation. Lastly, in case of double taxation, it should be avoided with enough concentration. Many people fall under double taxation here. There should be clarity in these matters,” Prawma Tapashi Khan said.
ACCA Bangladesh and experts from various sectors, including Arif Al Islam, MD and CEO, Summit Communications, Mamun Rashid, managing partner, PWC Bangladesh, and Masud Khan, chairman, Unilever Consumer Care Limited, also shared their insights.
From ACCA Bangladesh, Shah Waliul Manzoor, senior business development manager (Learning), Abdullah Al Hasan, marketing manager, GM Rashed, business services and compliance manager, and Syeda Sadia Afroze were present. The event was moderated by Prawma Tapashi Khan in partnership with ACE Advisory and TaxHouse Bangladesh Limited. (ACCA budget virtual roundtable video link: https://www.facebook.com/ACCA.Bangladesh/videos/183811980338541)