Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
Small and medium entrepreneurs in old part of Dhaka have called on the government to introduce a package VAT for essential commodities to help contain inflation.
They made the appeal at a views-exchange meeting organised by Dhaka Chamber of Commerce and Industry (DCCI) at a community centre in the capital on Saturday.
The business community identified a range of ongoing challenges, including severe traffic congestion, waterlogging, poor infrastructure, and limited access to financing for small and medium enterprises (SMEs).
They also voiced concerns about the deteriorating law and order situation, rising dollar prices against the taka, delays in import and export procedures, high interest rates on loans, increased VAT and tax rates, and the complexity of the revenue structure.
In his welcome address, DCCI President Taskeen Ahmed emphasised the need to simplify the country's tax and VAT system.
He proposed tailoring the system to the size, nature, and capacity of businesses, and removing complexities and bottlenecks in import-export procedures and fixing a realistic VAT rate.
Mr Ahmed noted that despite being one of the oldest business hubs in the country, Old Dhaka entrepreneurs continue to face numerous challenges, including worsening traffic congestion, inadequate infrastructure, and ongoing tax and VAT issues.
"To resolve these problems, a joint initiative from both the government and private sector is crucial," he said.
He also stressed the importance of improving the law and order situation to ensure a more business-friendly environment in the area.
Dr Md Selim Al Mamun, Director (Research), Chief Economist's Unit, Bangladesh Bank, pointed out that from 2022 to 2024, the Taka depreciated by 35 per cent against the dollar in the local market, causing instability in currency management.
However, he assured that the central bank is actively working to stabilise the exchange rate.
He said imports and exports have increased by 3.5 per cent and 10.9 per cent respectively over the past six months and remittance inflow has also reached US$ 16 billion in the past seven months.
Bangladesh Bank has already formed a taskforce to recover money that has been siphoned out of the country, he added.
Manash Kumar Barman Additional Commissioner of Customs Excise and VAT Commissionerate (South, Dhaka), NBR, said that the government has already initiated efforts to automate the VAT system through an online registration process, with a view to easing the vat payment return system and reducing harassment.
He also urged entrepreneurs not to pay VAT to anyone without receiving a receipt.
He clarified that VAT is always calculated based on the value added to a product, rather than the manufacturer's price.
Md Jashim Uddin, Deputy Commissioner of Police (Lalbagh Division) of Dhaka Metropolitan Police (DMP), said that traffic police will be deployed at eight important points to ease traffic congestion in old Dhaka.
He urged the businessmen to come forward to recruit volunteers to assist with this effort.
He also suggested the traders take assistance from the police for transportation of cash during the upcoming holy month of Ramadan.
He also revealed that a number of roads in old Dhaka will soon be designated one-way to ease traffic congestion.
Matiur Rahman, former president of DCCI, emphasised the need to reduce the LC margin, regardless of the bank-client relationship, in light of the country's current economic situation.
He also expressed concerns about the practice of changing tariff rates mid-year through SROs.
Manwar Hossain, Chairman of Anwar Group of Industries and former DCCI director, called for an expansion of the tax base by reducing and rationalising tax rates.
Abdus Salam, former senior vice-president of DCCI said that due to unbearable traffic congestion, the sales of old Dhaka traders have been steadily declining while high tax and VAT rates have led to increasing losses for the businesses.
At the end of the event, DCCI President Taskeen Ahmed handed over DCCI's membership certificates to 33 newly enrolled members.
DCCI Vice President Md Salem Sulaiman and Members of the Board of Directors were also present.
talhabinhabib@yahoo.com