Demand tax cut on capital machinery import
Different trade bodies and business associations have put forward a number of recommendations and demands to the government for incorporating those in the national budget for the 2013-14 financial year to be placed in Jatiya Sangsad today.
Most of the bodies on various recent occasions have made a common demand that the government should extend tax holiday facility and reduce corporate tax and duty on import of capital machinery and raw materials to attract local and foreign investment to the country.
The bodies who are engaged in manufacturing in the country have demanded some benefits for the protection of local industries including reduction of bank interest rate to a single digit.
Business bodies have also recommended the government to increase the ceiling of tax-free individual income considering the sufferings of people due to current high inflation.
The demands made by the trade bodies and business associations are highlighted below:
FBCCI
The Federation of Bangladesh Chambers of Commerce and Industry has demanded reduction of customs duty on import of capital machinery, raw materials, reduction of tax at source on export, continuation of tax holiday for some sectors, increase of tax-free income ceiling for individual taxpayers and introduction of multi-layer VAT rate.
The FBCCI has demanded reduction in duty on the import of intermediate raw materials, not produced in the country, to 3 per cent instead of the existing 12 per cent and import duty imposed on intermediate raw materials, produced on the local market, at the rate of 12 per cent.
The apex trade body has demanded an increase of the tax-free income threshold for individuals to Tk 2,40,000 from Tk 2,00,000 considering high pressure of inflation and an increase of living cost.
It also recommended a reduction of tax at source on export to 0.6 per cent from the existing 0.8 per cent.
The FBCCI proposed reducing the import duty on capital machineries to 1 per cent from 3 per cent considering flourishing the industrial sector, imposing lowest import duty on basic raw materials as well as zero import duty on capital machinery for 100-per cent export-oriented industries.
DCCI
The Dhaka Chamber of Commerce and Industry has demanded an increase of the ceiling of taxable income for individual taxpayers to Tk 3 lakh and for disabled people to Tk 3.75 lakh and expansion of tax holiday facility for investors for another three years.
The DCCI recommendations also included depositing the government income and savings at banks at lower interest rate to bring down interest rate at single digit.
It has also demanded reduction in the rate of surcharge on wealth to 5 per cent from the existing 10 per cent and increase of the ceiling of wealth for surcharge to Tk 5 crore from existing Tk 2 crore.
The trade body has also recommended reduction of corporate tax on listed companies from 27.5 per cent to 15 per cent to attract non-listed companies to be listed in the stock markets and extending tax holiday for fisheries, poultry and dairy firms and handicraft sectors till 2025 in a bid to boost investment and local industries.
MCCI
The Metropolitan Chamber of Commerce and Industry has demanded bringing down the rate of customs duty on import of capital machinery, basic raw materials, intermediary raw materials and finished products to 1.5 per cent, 2.5 per cent, 7.5 per cent and 20 per cent respectively from the existing 3 per cent, 5 per cent, 12 per cent and 25 per cent respectively.
The trade body has demanded tax exemption for handicrafts, poultry and tourism industries along with newly-established factories and tax at reduced rate for textiles, jute and fisheries sectors until 2016.
The MCCI has also demanded an increase of tax-free income limit for women and aged people to Tk 3 lakh and for disabled to Tk 3.25 lakh from the existing Tk 2.25 lakh and Tk 2.75 lakh.
The chamber also demanded an extension of tax incentives including tax holiday, tax exemption and tax payment at reduced rate for another three years that will expire in June 2013 for some sectors.
BGMEA
The Bangladesh Garments Manufacturers and Exporters Association has demanded that the government allocate Tk 300 crore in the next budget and give loan to the RMG factory owners at 5 per cent from that fund to shift their factories from shared buildings that are not compliant.
The BGMEA has also demanded duty withdrawal of import duty on fire fighting equipment, LED lights and all kinds of electronics appliance.
It has also sought special allocation for the workers to ensure essential commodities in subsidised price.
BTMA
The Bangladesh Textile Mills Association has demanded continuation of tax holiday facility for five more years for the textile industries to be set up in the Dhaka, Gazipur, Tongi, Narayanganj, Narsingdi and Mymensingh areas.
The BTMA has also urged the NBR to reduce rate of the income tax to 10 per cent from the existing 15 per cent.
The textile entrepreneurs have also demanded creation of ‘textile up gradation fund’ and allocation of resources to encourage investment in the sector.
BWCCI
The Bangladesh Women Chamber of Commerce and Industry has demanded exemption of women entrepreneurs from paying value-added taxes for at least three years after initiating their businesses and introducing tax-free income limit at Tk 5 lakh.
The BWCCI has also demanded VAT-free turnover ceiling for cottage industry be increased to Tk 50 lakh from the existing Tk 25 lakh and reduction of tax on export to 0.5 per cent from the existing 0.8 per cent.
DSE
The Dhaka Stock Exchange has demanded developing a fund of Tk 5,000 crore for the stock market in the upcoming budget for capital market stabilisation and tax exemption facility for five years for the organisation after its demutualisation.
The DSE has also proposed reduction in corporate income tax rate to 32.5 per cent for publicly listed banks, insurances and financial institutions and 37.5 per cent for non-listed ones from the existing 42.5 per cent.
BPGMEA
The Bangladesh Plastic Goods Manufacturers and Exporters Association has demanded an increase of rate of cash incentive from existing 20 per cent to 30 per cent for direct exports of plastic goods and its continuation for the next five years.
The BPGMEA also demanded 100 per cent customs duty on import of UPVC pipe from existing 30 per cent to protect the local industry.
The trade body, however, demanded withdrawal of customs duty on import of moulding machines and reduction of duty on import of raw materials to 5 per cent from 25 per cent.
BIA
The Bangladesh Insurance Association has demanded reduction of capital-gain tax on company taxpayers’ income derived from share transactions in the capital markets to 5 per cent from the existing 10 per cent.
The BIA has proposed reduction of income tax for the life insurance companies at 15 per cent and reduce the income tax for general insurance companies to 37.5 per cent including 2.5 per cent surcharge for general insurance companies from the existing 42.5 per cent.
REHAB
The Real Estate and Housing Association of Bangladesh has demanded reduction of tax on transfer of residential and commercial land, buildings and apartments, saying that the profit margin of developers decreased substantially due to price hike of land and construction materials.
The association has also demanded allowing of legally earned undisclosed money in buying apartments and investing into real estate sector without disclosing the source of money.
BGAPMEA
The Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association has demanded its authority of issuing utilisation permission certificates from the NBR.
The BGAPMEA also proposed providing 10 per cent cash incentives for exporters and reduction of the tax at sources from 0.60 per cent to 0.25 per cent to boost the sector.
BARSMA
The Bangladesh Auto Re-Rolling and Steel Mills Association has proposed increasing duty on import of MS bar, MS rod and ship scrap to protect local re-rolling and steel mills as local industries are fully capable of fulfilling the demand of the country.
The association has also proposed withdrawal of pre-shipment inspection system on import of melting scrap, re-rollable scrap and sponge iron.
BARVIDA
The Bangladesh Reconditioned Vehicles Importers and Dealers Association has demanded introduction of a common valuation method for customs duty on the import of both reconditioned and brand new vehicles.
The association leaders have also demanded a reduction in supplementary duty on the import of 1500cc to 1800cc reconditioned cars from 100 per cent to 45 per cent and rearrangement of supplementary duty slab for reconditioned cars.
BFLLFEA
Bangladesh Finished Leather, Leather Goods and Footwear Exporters Association has demanded reduction of duty for export-oriented chemical importers and commercial importers.
The BFLLFEA has demanded reduction of duty to 20 per cent and merge the existing three layers to one layer in import of chemicals.
The trade body proposed reduction of duty, VAT and other taxes on import of chemicals used in the sector ranging from 10 per cent to 20 per cent from the existing 25-61 per cent.
BASIS
The Bangladesh Association of Software and Information Services has demanded exemption from paying VAT at the rate of 4.5 per cent for the information technology-enabled services for at least 3 years.
It also demanded tax holiday for five years for newly-established 50 companies in the field of International Gateway and Inter Connect Exchange.
BCWMA
The Bangladesh Ceramic Wares Manufacturers’ Association has demanded for stopping under-invoicing and false declaration in import of ceramic wares, particularly ceramic tableware, tiles and sanitary ware, to protect the local industries.
The BCWMA has also demanded withdrawal of VAT and reduction of duty on imports of raw materials for this sector.
AEOSBIB
The Association of Export Oriented Shipbuilding Industries of Bangladesh demanded that the government should allow duty-free import of raw materials and equipment for ships equal to or bigger than 3,000 DWT (deadweight tonnes) to encourage the industry and boost export.
The association also demanded the facility of opening back-to-back letters of credit up to 75 per cent value against export on master LCs.
-With New Age input
