Staff Reporter
The government will go for a wide extension of the tax-net in the upcoming budget for 2009-10 fiscal year, as it will have to concentrate on internal resources, in view of a slowdown in foreign aid flow in the wake of the global recession.
National Board of Revenue Chairman Mohammad Abdul Mazid said it while addressing two separate pre-budget discussions: first one with the newspaper editors, senior journalists and media personalities and the second one with the leaders of the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI) yesterday.
As demanded by the apex business body, the NBR chief also made an indication of allowing investment of “black money” in productive sectors, saying, “the government wouldn’t let any money, taxed or untaxed, remain idle.”
FBCCI leaders urged the government to introduce ‘investment bond’ where the suspected stashes of black money can be invested without any question.
“To create scope for investment without question, we are proposing to introduce five-year-long investment bond with 7.5 percent interest,” FBCCI president Anisul Huq said.
He also said that the government should allow undisclosed money, which is popularly known as black money, and untaxed money in investment, industrialization and employment generation.
Anisul also forwarded the business community’s proposition to the government to raise the income tax-free ceiling to Tk 200,000 from the existing slab of Tk 165,000.
He also pleaded for introducing five-tier slabs for income tax: up to Tk 200,000 as tax-free, Tk 350,000 with 10 percent tax, Tk 450,000 with 15 percent tax, Tk 600,000 having 20 percent tax and the last one with 25 percent tax.
The business leader put emphasis on the continuation of the tax holiday for the next five years in the interest of industrialization and investment.
Anis stressed strengthening the automation system in the customs as the alternative to the pre-shipment inspection (PCI) system in import trade.
He urged the government to amend the Tax Ombudsman Act to make it more effective.
Installation scanning machine in all customs stations and development of the infrastructure facilities are also in the package proposal mooted by the business community that encompasses entire economic spectrum of the country.
They suggested reshuffing of duty structure in the new budget. As per their suggestions, capital machinery and raw material will bear 1 percent customs duty, intermediary raw material (which is not produced in the country) 5 percent, intermediary raw material (which is produced in the country) under 12 percent, and finished and luxury items (including supplementary duties) 25 percent.
While exchanging views with the journalists at his office, the NBR chief said “The new government has some election pledges on development to fulfill, when foreign aid flow is slowing down due to global economic recession. So, in formulating the budget, we will have to concentrate more on internal resources and expand the tax-net to manage the budgetary funding.”
“The next budget will expand the taxpayers’ net as many people who should be paying have so far dodged tax,” he added.
Daily Star editor Mahfuz Anam, Financial Express editor Moazzem Hossain, the New Nation editor Mostafa Kamal Majumder, Manavzamin editor Matiur Rahman Chowdhury, Faridur Reza Sagor from Channel I, NTV executive director Enayetur Rahman Bappi, noted journalist Syed Abul Maksud, Shah Alamgir of Jamuna Television, Shyamol Dutta of Bhorer Kagoj, Kawsar Rahman of Janakantha, Zakaria Kazal from Inqilab, M Hamid of RTV were present at the meeting, among others.
Mazid disclose that the government earned a sum of Tk 30,499 crore in revenue in the first eight months of the current fiscal, against around Tk 27,000 crore of the same period of last year.
“The growth in customs duty is 9 percent, in VAT 12 percent and income tax 20 percent,” he said.
He disclosed that the NBR hooked 60,000-70,000 new taxpayers onto tax net through their tax-survey drive while added 98,000 new taxpayers in the self-motivation campaign.
Explaining the shortfalls in reaching VAT and import duty targets, he said, “Global prices of most commodities, such as fuel and food grain, were on the high side when the government announced the 2008-09 budget, and began falling soon after.”
“Fuel oil that was sold at $140 now costs around $40, which is why revenue from VAT and import duty have also seen sharp cuts.”
Mentioning that there has been a proposal for introducing a separate pay scale for tax officials, he said, “I’ve told the pay commission that taxmen must have a separate pay scale with increased pay and allowances, as their services shouldn’t be compared with those of the social welfare or any other ministry.”
The NBR chairman assured all present that tax officials would contribute more positively once their pay and allowances were enhanced.
Courtesy of The New Nation
