Economy
4 months ago

Next budget will be encouraging for private sector: Finance Minister

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Finance Minister Abul Hasan Mahmood Ali on Sunday said that the upcoming budget will be encouraging for the private sector and hoped that the economic growth momentum will be continued towards achieving the growth targets.

He assured that the government would consider all the rational recommendations from the private sector.

He also said the private sector is playing a key role in the development of the country.

"Government is firmly committed to facilitating the private sector so that they can do their business in a hassle-free manner," he said while speaking at a pre-budget discussion organised by the Dhaka Chamber of Commerce & Industry (DCCI), in association with Samakal and Channel 24, at a city hotel.

The Finance Minister said that the government has taken various policy measures, including market monitoring, for which inflation will come down soon.

He also informed that the government will positively consider necessary policy reforms in the next budget.  

"Moreover, long-term strategy, skill development, support for import substitute industry, export diversification, internal resource mobilisation and employment generation will get priority in the next budget."

The minister said that this government is a pro-business government, and any rational recommendation from the private sector will be considered. 

DCCI President Ashraf Ahmed moderated and chaired the discussion.

Mentioning that the number of tax payers is not at the expected level, the DCCI President emphasised increasing the tax net across the country to increase the tax-GDP ratio.

For a sustainable financial sector, a few policy reforms, reducing NPL, increasing reserve, boosting private sector credit flow and maintaining a stable liquidity situation are crucial, he said.

Mr Ahmed also said that our industry needs uninterrupted power and energy supply at a competitive price. He later underscored the importance of increasing private sector credit flow for economic development.

Speaking on the occasion, Former FBCCI President A K Azad, MP said that more than two million youth are unemployed in the country.

In this regard, he emphasised more skill development and utilisation of technology.

He suggested more empowerment of the central bank to ensure good governance, especially in the financial sector.

Former Principal Secretary Abul Kalam Azad, MP emphasised policy consistency so that foreign investors can plan for a long time while investing in Bangladesh. He also underscored the importance of a simplified taxation system to increase revenue collection.

NBR Chairman Abu Hena Md Rahmatul Muneem said that the government has to strike a balance between tax net expansion and tax burden.

“In 2020, the total individual tax payers were only 21 lakh and in February 2024 it was 37 lakhs. NBR also took the initiative to integrate an automated system in tax collection with a view to expanding revenue collection. In June 2020, BIN holders were 2 lakhs whereas in March 2024 it stood more than 5 lakhs,"  he said.

The NBR Chairman called upon the business community to boost local demand with an adequate production increase.

Secretary of Financial Institution Division Sheikh Mohammad Salim Ullah said, “We have to increase our investment. The private sector mainly generates a large portion of employment in the country.”

Work is on to introduce a policy framework to reduce Non Performing Loans (NPLs), and the government is working on forming asset management ventures, he said.

“In order to establish good governance in the overall financial sector, a roadmap has been prepared,"  he informed.

For the economic development of a country, an efficient private sector is crucial, he said, urging the private sector to concentrate on cost effectiveness and new innovation.

Deputy Governor of Bangladesh Bank Dr Md Habibur Rahman said inflation, stability of the exchange rate, and reducing NPL are a few of the priorities at this moment.

He said that it is important to ensure credit flow to the private sector for better industrialization and employment generation.

“Our economy is a private sector-led economy, and 80 per cent of our credit flow goes to the private sector," he added. 

The discussions were divided into four important sessions: Tax and VAT, Financial Sector, Infrastructure sector and Industry & Trade sector.

Sayeed Ahmed Khan, Head of Taxation, Unilever Bangladesh, Arif Khan, Vice Chairman, Shanta Asset Management Ltd, Aftab-Ul Islam, FCA, Former President, DCCI, Rizwan Rahman, Managing Director, ETBL Holdings Ltd, Mohammed Hatem, Executive President, BKMEA, Shams Mahmud, Managing Director, Shasha Denims, Dr. Masrur Reaz, CEO, Policy Exchange Bangladesh, Imran Karim, Vice Chairman, Confidence Group and Syed Ali Jowher Rizvi, Managing Director , Summit alliance Port Ltd took part in the discussions from the private sector.

Moreover, former member NBR Md Farid Uddin and CEO, ICAB Shubhasish Bose also spoke on the occasion.

The speakers also opined for the reformation and modernisation of the existing VAT Act.

Self-assessment system and awareness creation will foster tax net and revenue, they said, putting emphasis on increasing the tax-GDP ratio, effective automation of the taxation system, simplification of the return system, ensuring ease of doing business, bond market development for long-term project finance, good governance, export diversification, uninterrupted energy supply, and a vibrant capital market.

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