Business Initiative Leading Development BUILD has urged to reduce costs of administration and compliance, ensure procedural fairness, transparency and build confidence in the taxpayer-citizen-client in the next.
It also demanded the increased reliance on Information Technology -- electronic payment facilities. BUILD asked for considering the taxpayer as customer and facilitating compliance.
BUILD Chairperson Abul Kasem Khan placed the budget proposals for FY2021-22 to the Chairman of National Board of Revenue (NBR) Abu Hena Md. Rahmatul Muneem on containing the above recommendations.
In order to revive the post COVID19 economy, BUILD placed some effective recommendations in a bid to facilitating the tax revenue collection procedure of the government focusing on widening tax net, corporate tax reduction, minimizing the gap of supply side and demand side and simplifying the tax payment procedures.
During the meeting with NBR, BUILD Chairperson said that we see no other option for increasing the Tax GDP ratio, he added the existing ratio of direct and indirect tax in Bangladesh is around 35:65 which should be reversed to uphold the interest of the consumers and the productive sectors.
Priorities for this year Budget should be increase the tax-net, reduce the tax-rates, simplify tax payment procedures to encourage taxpayers.
With the highest rate of corporate income tax, there are some other taxes such as AIT, TDS has automictically raised the CIT to 40-45% which is not realistic. BUILD proposed to rationalize the tax ratio and reduce the CIT to 30% from the present rate of 32.50%, provided that re-investment is ensured. In addition, to increase employment a further 1% tax reduction for creating additional jobs within the financial year can be treated as a merit to qualify to get total tax deduction at 3.5%.
Further BUILD urged the NBR to address the minimum turnover tax (2%) on gross receipts (82C of ITO 1984) for telecom sector since the present rate is discriminatory as for other sector it is 0.50%, for tobacco it is 1%.
After LDC Graduation Bangladesh will need to be more independent in acquiring technology and innovation. Research expenditure is the lowest in the country, BUILD proposed to consider 1% of Gross Revenue for Research, Innovation, Skills development and training as Tax deductible for 3 years.
In addition, individuals spending on computer, smartphones, laptops, trainings, skill development, research etc. for their family up to BDT 200,000 should get tax deductibles. These would encourage people to be trained and also improve technology adaptation, secondly improving skills set.
BUILD also made a call for Discounted Corporate Income Tax rate of 25% for all One Person Company (OPC) under new tax slab to encourage them.
In order to encourage tax payers he referred introduction of Tax Card in different names for all tax payers which will play as a recognition and reward to tax payers must be made into smart card so that it is not only a dynamic database but also linked to NID and also become a reference for loans and services.
In responses to BUILD proposals, NBR Chairman told that the scope of Tax Cards in order to recognize the taxpayers of the country can be widened and in that respect NBR can prepare a list in consultation with other organization.
