BD needs more FDI to continue dev activities, says NBR chief

National Board of Revenue (NBR) Chairman Mosharraf Hossain Bhuiyan said that Bangladesh has adopted an equitable tax policy for all and no foreign investors face discrimination here.

In order to continue with the development activities, he said, Bangladesh needs foreign direct investment (FDI) in higher volume. That's why investment is being facilitated here by taking favourable policy measures, he added.

"And all the policies we adopt are more or less equitable. We don't discriminate foreign country (investors) vis-a-vis domestic investors," Mr Bhuiyan said.

He was speaking as guest of honour at a luncheon meeting of the American Chamber of Commerce in Bangladesh (AmCham) at a city hotel on Thursday.

Chamber president Nurul Islam chaired the event attended by foreign dignitaries, economists and members of the organisation.

While speaking at the meeting on "Road to Prosperity: Equitable Tax Regime for Businesses- Local and Foreign", the NBR chief also pointed out that investors of some countries enjoy the benefits of double taxation avoidance.

He said Bangladesh is now a 'country of miracle'.

Many of the economists, experts, and think tanks all over the world were sceptical about the data of growth, per capita income, and GDP of this country.

But now it has been proved that the figures that have been declared sometimes are even lower than actual because of the informal economy of this country which are not being reported, he said.

Mr Bhuiyan also said the country is progressing at a very good pace which is being reflected in money circulation, expenditure pattern as well as employment generation in the country.

The economic growth for the last 10 years was highest since the country's independence, he added.

During the last five years, the growth was seven-plus percentage point while it was six-plus percentage point in the previous five years. This fiscal year the growth is expected to be over 8.0 per cent. The per capita income has also increased, he noted.

The NBR chief also said the government is comfortable with foreign companies here in a sense that their record keeping, as well as declaration of profits, are very transparent.

In terms of revenue generation, they are also contributing to a great extent to the economy, he said.

Mr Bhuiyan at this point blasted the USA for pursuing a discriminatory policy for Bangladeshi businesses.

"I just want to point out one issue. In our country, we don't discriminate, but unfortunately, in the USA, we face discrimination on taxation," he said.

"Why we should pay 15 per cent tax on export of our apparels to the USA where Vietnam pays only seven to eight per cent?" he asked.

He invited more US investors to come to Bangladesh to enjoy the benefits of equitable tax policy.

Mr Bhuiyan brushed aside a complaint that corporate tax rate in Bangladesh is very high.

"Our analysis found that in many countries, the corporate tax rate is much higher than Bangladesh. Even our corporate tax is lower than that of India. In case of listed companies, our corporate tax is also lower than others," he noted.

But he admitted that in case of tobacco, Bangladesh's corporate tax is high and he explained that "this is the principle we follow to discourage tobacco production as well as consumption."

"But I think tobacco companies are comfortable with our policy," he added.

He also admitted that cell phone companies are taxed a bit higher.

Mr Bhuiyan said Bangladesh's tax-GDP ratio is one of the lowest in this region which is only 10 per cent.

"The main reason of low tax income is tax avoidance by many who are eligible and have the ability to pay. We are now going door-to-door to expand the tax net," he noted.

Chamber president Nurul Islam said equitable tax policy is of vital importance for the economic progress of the countries that have a policy of private sector-led growth.

And equitable tax regime helps the growth of revenue and supports greater spending on developing projects and creating jobs, he said.

Mr Islam said tax avoidance obviously goes against the principle of tax equity and it disturbs level playing field in the corporate world.

"It is, therefore, very important that the NBR enforces an equitable tax policy for business, both local and foreign. Level playing field is important for attracting and retaining foreign direct investment in the country," he added.

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