Tax holiday sought for new SMEs, land developers outside Dhaka
For exporters, the SME Foundation sought a reduction in source tax to 0.25% and corporate tax to 10%
The SME Foundation has demanded tax holiday for new entrepreneurs in the small and medium enterprise sector for 10 years, while the Bangladesh Land Developers Association (BLDA) sought the facility for real estate businesses in municipality areas.
The organisations placed their demands in a pre-budget talk organised by the National Board of Revenue (NBR) at its office in the capital on Monday.
Several other trade bodies, including the Bangladesh Association of Pharmaceuticals Industries, the Bangladesh LPG Autogas Station and Conversion Workshop Owners Association, the Bangladesh Marine Fisheries Association, Bangladesh Lub Blenders Association, and Bangladesh Tea Association joined the event.
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NBR Chairman Abu Hena Md Rahmatul Muneem and senior officials of the revenue collecting agency were present in the meeting.
"Currently, there is no tax holiday facility for SMEs, but it is needed for at least 10 years so that the entrepreneurs can grow up," said Lutfor Rahman, a consultant at the SME Foundation.
"The new VAT act relieves businesses having annual turnover up to Tk50 lakh from VAT and imposes 4% VAT on the next Tk3 lakh turnover. However, the businesses do not enjoy the privilege as the NBR, in the meantime, made VAT registration mandatory for 78 sector businesses including them," he added.
He, also a former NBR member for customs, urged the revenue board to clarify the contradictory rules, while placing the SME Foundation's budget proposal.
The foundation sought some other tax facilities for the small-scale entrepreneurs. It suggested increasing the income-tax-free threshold to Tk5 lakh for women entrepreneurs, to Tk10 lakh for third-gender entrepreneurs.
Other demands of the organisation are: cutting corporate tax for agricultural machinery producers to half and withdrawing tax deducted at source for them, reducing corporate tax for frozen food producers, and lifting tax on cash incentives and advance income tax on locally produced goods.
For exporters, the SME Foundation sought a reduction in source tax to 0.25% and corporate tax to 10%.
At the event, the BLDA demanded a tax holiday for five years for land developers in metropolitan cities and 10 years for municipality areas.
In response, NBR Chairman Muneem said they were in favour of the expansion of housing business to rural areas. "However, we should know how much benefits customers will get, and how much the industry, if we provide the facilities. We do not want to see that industry enjoys privilege suppressing customers," he added.
In the pre-budget talk, the Bangladesh Association of Pharmaceuticals Industries representative Ali Nawaz urged the NBR to withdraw customs duty on their imported raw materials and increase their spending limit in providing sample products to physicians.
He, also the chief financial officer of Beximco Pharmaceuticals, sought tax facilities in sending money abroad for the export promotion purpose.
Criticising the proposal, the NBR Chairman asked the representative how they should provide tax facilities for the means of "money laundering".
"We already announced huge exemptions for the pharmaceutical industry and promoted its exports. On the other hand, we are blamed for creating hindrance for the sector. Such words really hurt us," Muneem added.
