“Many have commented negatively on the tax of 2 thousand taka in the proposed budget. Many are bringing up the model of Margaret Thatcher. But we think such a tax system will make everyone willing to pay tax”, said Planning Minister M A Mannan in today`s joint post-budget discussion of Metropolitan Chamber of Commerce and Industries (MCCI) and Policy Research Institute (PRI).
Planning Minister M A Mannan also said that inflation will come down if the market system is kept uninterrupted. If society is destabilized it will be worse than corona and war. But now attempts are being made to destabilize the society. The increase in expenditure on social security in this year`s budget is very positive. VAT law must be discussed with you. Don`t buy goods if you don`t want to pay VAT. VAT is a good revenue collection method.
In this budget, MCCI sees a double bind with bank borrowing by the government. It could create a crowding out effect, or lead to inflationary pressure. In addition, the Chamber also feels that the budget for FY24 should focus more on pro-poor and inclusive growth. Taxation problem is a government problem. Gov knows who owns much yet to do nothing. Saturday Dr. Sadiq Ahmed Vice President of PRI say that in a` MCCI-PRI post budget discussion`.
Dr. Sadiq Ahmed Vice President of PRI says, Tax should be online there’s no question about it. It would be easy and non negotiable. Some 60 % of Budget is already fixed with wages and other issues. So other 40 % of remaining should cautiously used.
Taxation problem is gov problem. Most of the rich pays less tax. Because It`s a governance problem. Gov knows who has most asset, who goes where. Yet they do nothing about it.
He also said that, Tax dividend should not be layered. Demand management should be concern. World commodity price isn’t high anymore. Vietnam and other emerging countries has 2 % inflation. So with out demand management inflation could not be controlled.
In this discussion MCCI felt a little disappointed that there was no proposal to revise the terms of cash transactions in terms of corporate tax rates. We also think that the high effective tax rate could be lowered by rationalizing the rate of TDS. In addition, we request for the abolition of minimum tax on the turnover of the organizations.
The filing of income tax returns with a minimum payment of Tk. 2,000 in case of availing services without a tax-exempt income tax limit may have a negative impact on income tax payers. This could be a cause for concern in the informal sector. We also believe that the appointment of tax agents needs to be addressed with the utmost care. Otherwise, it might jeopardize the relationship between taxpayers and tax collectors.
MCCI appreciates the raising of the tax-free income ceiling for both individuals and third gender taxpayers. MCCI also appreciates the clarification on the provision of the Central Registration for VAT. However, MCCI is disappointed that there is no substantial suggestion for structural reform of the VAT Act (incorporation in the original VAT Act, 2012). The chamber is also concerned that the increase in supplementary duty rates on imported goods may raise the cost of living.
MCCI thinks the new inflation target may be hard to reach with current inflation rates. Also, the increase in tax rates on transfer of flats and immovable property may adversely affect individuals and companies. MCCI is suggesting a re-fixation of prices based on mauza instead of increasing this tax rate.
MCCI member Adeeb H khan says, Minimal income tax 2 k isn’t appropriate. It should not be there.
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