Tax holiday for ICT sector likely to be extended: Salman F Rahman

The newly elected executive council (EC) of Bangladesh Association of Software and Information Services (BASIS) started their tenure at an event on Tuesday (21 May). Photo: Collected

The tax holiday for the ICT and IT enabled services, set to end this fiscal year, might be extended in the upcoming budget, hinted Salman F Rahman, the prime minister's private industry and investment adviser. 

"I had an opportunity to talk to the prime minister about the issue of tax exemption. She assured me that the industry proposal would be considered, with the aim of imposing taxes consistently and rationally over different periods," he said while speaking as the chief guest at an event to onboard the newly elected executive council (EC) of Bangladesh Association of Software and Information Services (BASIS) in the capital on Tuesday (21 May). 

Salman F Rahman said the upcoming budget might indicate how many more years the tax holiday for the sector will remain in place.

The 11-member EC of the country's tech industry's largest association began their tenure with an oath to achieve self-sufficiency and establish sovereignty of indigenous software in the ICT sector to implement Smart Bangladesh.

State Minister for Posts, Telecommunication and Information Technology Zunaid Ahmed Palak, State Minister for Commerce Ahasanul Islam Titu were present at the event as special guests and FBCCI President Mahbubul Alam spoke as a guest of honour. 

BASIS founder president A Towhid administered the oath to the BASIS President Russell T Ahmed, Senior Vice President M Rashidul Hasan, Vice President (Admin) Syed Mohammad Kamal, Vice President (Finance) Iqbal Ahmed Fakhrul Hasan, and the newly elected Directors Md Mostafizur Rahaman Sohel, Didarul Alam, M Asif Rahman, Dr Muhammad Risalat Siddique, Mir Shahrukh Islam, Biplob Ghosh Rahul and Syed Abdullah Jayed took oath.  

Criticising the government move to start taxing the flourishing ICT sector, re-elected BASIS President Russell T Ahmed said the National Board of Revenue (NBR) and IMF are seeking taxes from the sector based on inflated turnover and profit assumptions.

But the potential sector needs tax holiday till 2031 as competitor countries, despite being more advanced, are still continuing their incentives, he added. 

He also urged for a foreseeable tax policy based on which entrepreneurs can plan their investments. 

FBCCI President Mahbubul Alam, in support of the BASIS demand, emphasised that the ICT sector would play immense role in the implementation of Smart Bangladesh.

State Minister for Commerce Ahasanul Islam said his ministry is working on ICT sectors' market access in the major international markets, while local firms should be competitive in serving the local demand—both from the government and private sector. 

Local software industry has many talented ICT professionals and the firms now should eye their additional knowledge in specific domains to tailor-fit industry-specific demand, for instance financial sector, healthcare, he added. 

Praising the two and a half thousand BASIS member firms for creating around 3 lakh jobs, Zunaid Ahmed Palak said it should be increased to 10 lakh to meet the $5 billion ICT export target by 2029. 

Endorsing the industry's request for a 5-year tax exemption, he also mentioned the government's intention to financially support ICT firms for their recruitment and training efforts. 

He emphasised that the youth require frontier-tech skills to propel Bangladesh towards a technology-driven economy.