The Chittagong Chamber of Commerce & Industry (CCCI) and its initiative Bangladesh Center of Excellence (BCE) organised the first national-level Post Budget (2021-2022) Dialogue on Tuesday.
The session was chaired and moderated by CCCI President Mahbubul Alam where FBCCI President Md. Jashim Uddin joined as Special Guest of the Panel, said a press release.
The other esteemed panelists were Mr. Faruque Hassan, President, Bangladesh Garments Manufacturer and Exporters Association (BGMEA), Ms. Rupali Haq Chowdhury, President of Foreign Investors’ Chamber of Commerce & Industry (FICCI), Mr. Alamgir Kabir, President, Bangladesh Cement Manufacturer Association (BCMA), Mr. Asif Ibrahim, Chairman of Chittagong Stock Exchange (CSE) and Prof. Dr. Md. Salim Uddin, Chairman, EC, Islami Bank Bangladesh Ltd. The session also saw participation from Chamber Director Syed M. Tanvir and Representatives from Media.
CCCI President Mahbubul Alam termed the budget of 2021-2022 as visionary and in alignment to the national vision of becoming a developed country by 2041. He particularly lauded government’s effort to reduce Corporate TAX, sector based tax reductions and tax holiday as key indicators of private sector investment facilitation. He also requested the FBCCI President and other Chamber and Association leaders to urge the government to particularly speed up the proper implementation of the priority infrastructure projects such as BAY TERMINAL, Port Capacity Development in Chattogram and immediately solve the waterlogging problems as well as implement Karnaphully river dredging to protect the port and the port city and commercial capital of Bangladesh.
FBCCI President Md. Jashim Uddin said Bangladesh has achieved GDP growth due to government spending not private sector investment. He also mentioned that even though the large industries have benefitted from stimulus packages declared by the government but CMSMEs have largely remained at bay due to lack of implementation from the commercial banks and NBFIs. He also urged the government to increase the no. of tax payers through spreading tax collection system to cover even Upazilla level potential taxable wallets instead of putting excessive pressure on current tax payers. He opined that Tax policy and implementation wings should be kept separate and comparing with the global market and its changing scenario the tax policy and system should be reviewed.
FICCI President Ms. Rupali Haq Chowdhury termed this budget as local industry-friendly. She said in recent years foreign investment has largely been low. Even though government is extensively developing infrastructures but the softer issues such as legislative environment and policies to improve the overall investment climate needs immediate improvement as well. She said incidences such as the sudden declaration of 15 per cent VAT on land purchase from economic zones of BEZA is irrelevant. She also urged the government to reduce the current tax (which is almost 56%) on telecommunication.
BGMEA President Faruque Hassan said continuation of 1% incentive will encourage export growth. He appreciates government’s effort on skill development for the sector and expected that government’s activity and implementation under this should be implemented fast. He also opined that policies should be kept sustainable for 5-10years to make sure businesses can leverage the benefits properly. He said to get the GSP plus benefits the value addition needs to increase and thus far considering the changing global scenario, he requested the government to provide stimulus for Non-Cotton based RMG production which can help RMG sector increase its value addition. He also requested the government to cancel the 10% tax on incentive.
BCMA President Md. Alamgir Kabir said, there are 37 cement manufacturers in Bangladesh with a total of Tk. 42,000 Crore investment. It plays critical role in national infrastructure development and is a great wallet of revenue collection for government. He requested the government to not consider Advance Tax as ultimate liability and reduce tax on clinker import and cancel the double taxation on the sector. He also said businesses who use port are all payers of the Advance tax however, those who don’t use port remains free of this tax and thus far it creates an uneven competitive scenario in the market.
CSE Chairman Asif Ibrahim said COVID 19 has devastated the capital market in Bangladesh. Transactions were closed for almost 2 months. The cost of operation for brokerage house has also increased. Even though government has reduced the corporate tax on public listed companies but the gap between listed and non-listed companies need to widen so that more companies are interested to come in the capital market and thus far reduce the excessive pressure on the banking system for capital financing. He requested the government run profitable corporations to enter the capital market. He said a small company to raise 7.5 Crore taka capital has been listed under CSE and will launch its capital market operation from June 09, 2021.
IBBL EC Chairman Prof. Dr. Md. Salim Uddin said any big budget shall naturally have big deficit. But government has not been able to get expected level of foreign loans in recent years. Tax reduction may result in lack of revenue for government leading to lack of expenditure which can ultimately create excessive pressure on local banking system. He requested to increase the tax holiday ceiling for women entrepreneurs to BDT. 1 Crore turnover per year and to make it BDT. 80 lac turnover per year for manufacturing based CMSMEs and 50 Lac turnover per year for Service and trade based CMSMEs. He also urged government to redistribute the slabs on Individual income tax to ensure better balance. While he also requested the government to cancel the 5 per cent AIT on Cash Register immediately so that businesses are encouraged to use cash register.