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Business Initiative Leading Development (BUILD) has demanded reducing corporate tax for all the export-oriented sectors in the upcoming fiscal year (FY).
It urged the government to consider the leather, plastic, light engineering and other export-oriented sectors for bring down the tax at a rate equal to the apparel sector.
The measure would help the sectors recover from the negative growth suffered due to the impact of the Covid-19 pandemic, BUILD said in a post-budget proposal to the National Board of Revenue (NBR) recently.
Currently, the apparel factories are enjoying 12 per cent corporate tax (10 per cent in case of the green factories) while 35 per cent for other industries.
However, the government has proposed reducing the corporate tax of non-listed companies to 32.5 per cent for the FY 2020-21.
In a letter to the NBR, the CEO (Chief Executive Officer) of the public-private dialogue platform Ferdous Ara Begum sought the fiscal incentives for the leather, light engineering and plastic sectors.
She said that VAT exemption is needed for some essential plastic products like tiffin carrier or water bottle of daily use by the common people.
All the plastic factories are bound to obtain VAT registration irrespective ofthe size of turnover which is difficult for the small enterprises, she wrote.
Such provision could be withdrawn during the COVID-19 crisis, she added.
For light engineering sector, the BUILD proposed VAT exemption at the production stage of capital machinery and spare parts for repairing and servicing and waiver of taxes on import for raw materials.
The BUILD suggested formation of a joint working committee to protect the interests of the micro, small and medium entrepreneurs.
It proposed to increase the tax-free threshold for individual taxpayers to Tk 0.4 million from the proposed Tk 0.3 million in the Finance Bill-2020 to facilitate low-income group of people.
The BUILD suggested reducing corporate tax by 2.0 per cent for the companies that have upheld employment in this pandemic.
It suggested the NBR to maintain a tax gap of at least 10 per cent between the publicly listed and non-listed companies.
The BUILD demanded a cut of corporate tax for publicly listed companies by 2.5 per cent.
It suggested withdrawal of source tax for local Letter of Credit (L/C) for reining in prices of essential products such as rice, wheat, potato, onion, garlic etc.
The BUILD recommended reinstating the source tax for exporters to 0.25 per cent considering the negative export growth.
According to the Export Promotion Bureau (EPB) of Bangladesh, exports declined by 18 per cent in the first eight months of the current FY.
The platform has sought withdrawal of black money whitening opportunity to ensure justice for the honest taxpayers and bring down the increased tax for mobile phone users.
It sought an efficient automated system for duty drawback, reduction ofturnover tax and VAT at the trading stage to 2.0 per cent, cut discretionary power of VAT officials, relax the time for bill of entry submission, rationalising the excise duty etc.
(FE)
