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The government has so far formulated many investment proposals. What is true about their implementation is that they largely depend on the National Board of Revenue's (NBR's) policy support. No investment initiative can be fully successful without its policy support.
The revenue board needs to take liberal attitude towards investors in a bid to improve the country's investment scenario. There should be automation for the bonded warehouse licensing process to reduce the NBR officials' involvement.
In recent days, the revenue authority has offered a good number of incentive packages for investors of the hi-tech park. Some of the aggrieved investors, who earlier left the park, have returned to the site with their investment following the board's support. The intending entrepreneurs should organise workshops with the investment development authorities to resolve confusion on tax matters.
However, some proposed an increase in the tax-free limit for individual taxpayers to Tk 0.3 million to raise the amount of minimum tax to Tk 5,500, and rationalisation of advance income tax for industrial raw materials at import stage. All taxpayers should be given tax cards extending the existing facility. Currently, the NBR gives tax cards to the taxpayers for their highest and long-term payment of tax on some specific categories.
The government has, however, decided to give 'Taxpayers Identification Number (TIN) Card' to the taxpayers just after submission of tax returns. It is a permanent card that the taxpayers can use for availing different services, including licensing and renewal. A copy of the TIN card can be made mandatory for availing different services.
Meanwhile, the country's investment development authorities have rightly sought adequate policy support from the revenue board in order to accelerate more investment. They maintained that such policy support from the NBR would help generate more employment and transform the country's existing trade-based economy into a production-based one.
There are a number of investment promotion agencies in the country that include the Bangladesh Investment Development Authority (BIDA), Bangladesh Economic Zones Authority (BEZA), Bangladesh Export Processing Zones Authority (BEPZA) etc. Such agencies are assigned by the government to make room for gearing up industrialisation process.
According to a study, some 408 industries have been getting tax holiday facility uninterruptedly for the last 15-16 years in the country. Due to a dearth of policy guidelines, some of the potential sectors are not getting the facility, while some sectors have been enjoying the same for last 10 years.
Some think-tanks have proposed to the NBR to cut high tariff protection to the local industries to make the market competitive. The revenue authority is reported to have been looking into the issue to see to what extent it can offer the protective tariff.
Alignment of relevant laws and regulations is needed to make it legally binding for all government agencies. The export processing zones and special economic zones should also come under such agencies to boost investment in the specialised zones.
Most of the enterprises should demonstrate that they have adequate skills to interpret and analyse financial indicators, especially in areas of cost accounting and auditing, and recruitment of qualified staff. Enabling environment is needed to facilitate effective governance including operational autonomy, accountability, corporate culture and incentive-based compensation system.
Appropriate steps should, therefore, be taken to include statutory provisions for implementing monitoring system, reward and punishment measures, and incentive-based programmes for the state-owned enterprises (SoEs) which at the moment are largely lacking. A comprehensive financial reporting framework for these enterprises is also deemed necessary.
Since the country's industrialisation is not getting that much support, investment promotion agencies want the government to incorporate required policies in the budget for promoting investment.
The national budget needs to address the employment situation seriously, as technological advancement is eating up the share of employment despite high export growth.