Call for extending IT sector tax exemption for three years

Leaders in the IT industry at a policy dialogue have called for the tax exemption to be extended for three years.

Keeping this exemption is crucial as removing same will diminish profitability and reduce reinvestment capabilities for IT/ITEScompanies, resulting in slower industry growth and diminished export potential, they said at the dialogue titled “Investment Climate for Smart Bangladesh”, organised by Venture Capital and Private Equity Association of Bangladesh (VCPEAB), in Sheraton Hotel in Dhaka’s Banani on Sunday.

VCPEAB President and Program Chair Shameem Ahsan said in his keynote, “After a three-year tax exemption period, an annual tax rate of 1 per cent to 2 per cent can be introduced. The contribution of IT sector to Bangladesh’s GDPstands at 1.09 per cent. In contrast, our neighbouring country India’s contribution is 7.40 per cent, Philippines’s3.40 per cent, Indonesia’s 4.23 per cent, Estonia’s 7.00 per cent.”

He also stated, “The evolution of Digital Public Infrastructure (DPI) reflects the increasing integration of digital technologies into everyday life, transforming governance and citizen interactions. Building powerful “Data &Digital Capital” fueled by Digital Public Intelligence, we can aim to make Bangladesh the “AI Use Case” capital of the world.”

Private Industry and Investment Affairs Adviser to the Prime Minister Salman F Rahman, MP, who attended the event as chief guest, said, “I plan to discuss with our Honorable Prime Minister about tax exemption in the IT sector. Instead of considering the withdrawal of tax exemption, we should explore options to provide additional incentives.”

State Minister for Posts, Telecommunications, and Information Technology Zunaid Ahmed Palak, MP, who attended there as special guest, said, “I support the reasonable demand from the ICT industry entrepreneurs. Therefore, I humbly request Mr Salman F Rahman, the Adviser for Private Industry and Investment to the Prime Minister of Bangladesh, to discuss with our honourable Prime Minister about the continuation of the current tax exemption for the ICT industry for the next few years.”

MP Kazi Nabil Ahmed, who also attended the event as special guest, said, “Tax benefits are crucial for growing industries like technology. To ensure a smart Bangladesh, we must establish a knowledge-based ecosystem that penetrates every segment. It’s imperative to leapfrog certain stages to bridge the gap with other countries; otherwise, we risk falling behind continuously.”

Zara Jabeen Mahbub, MP, who is also VCPEAB advisor, stated, “In order to achieve a truly smart Bangladesh, it is imperative that we do not overlook the pivotal role of women. Their inclusion is paramount. By prioritising women’s participation, particularly through healthcare digitization initiatives, we can not only enhance women’s health but also effectively realise the vision of a smart Bangladesh.”

Actor Ferdous Ahmed, MP, said, “There is a multibillion-dollar media, entertainment and technology industry. We need to digitize this industry in order to attract foreign investment.”

Partners of the event include ADN Telecom, Spectrum Engineering Consortium (Pvt.) Ltd, Smart Technologies (BD) Pvt Ltd, Bran Station 23 PLC, IT Consultants PLC, Bdjobs Ltd and eGeneration PLC.

Among others, FBCCI Senior Vice President Md Amin Helaly, DCCI President Ashraf Ahmed, CCCI President Omar Hazzaz, CSE Chairman Asif Ibrahim, Member of University Grants Commission (UGC) Prof Dr Md Sazzad Hossain, Chairman of Policy Exchange Bangladesh Dr M Masrur Reaz, Senior Research Fellow of Economic Research Group (ERG) Dr M Rokonuzzaman, Chairman of ADN Telecom Asif Mahmood, Founder of Bdjobs Ltd & former President of BASIS Fahim Mashroor, Managing Director of Spectrum Engineering Consortium Pvt Ltd Forkan Bin Quasem, Chief Investment Officer of Constellation Asset Management Tanveer Ali, Managing Director of Smart Technologies (BD) Ltd Mohammad Zahirul Islam, CEO of Brain Station 23 Raisul Kabir, Policy Advisor of Centre for Research and Information (CRI) Imran Ahmed spokes at the dialogue.