Al Amin :
The businesses have urged the National Board of Revenue (NBR) not to finalise the new income tax law, as what they said there have some inconsistencies.
The inconsistencies–high tax rate, non-refundable Advance Income Tax (AIT) policy, high rate at source tax and scraping tax holiday for new entrepreneurs– have been incorporated in the new tax law, they said.
These will put extra-pressure on the compliant businesses of the country, especially after the country’s LDC graduation when they will lose several benefits, the businesses said.
So, an effective discussion with the stakeholders is required before finalisation of the tax law, they added.
The NBR has finalised a draft of the Income Tax Act, 2022 incorporating domestic pricing and anti-avoidance rules and it would replace the Income Tax Ordinance -1984. The draft is now waiting for final approval of the Parliament.
Md Jasim Uddin, President of the Federation of Bangladesh Chambers of Commerce & Industries (FBCCI), on Sunday urged the authority of the NBR not to finalise the draft before consulting with the stakeholders.
Urging not to be hurried in finalizing the new law, he said, “New tax law is needed for the country, but it requires an effective discussion with the stakeholders.”
Considering the complexities of amending the tax rates on different occasions, the NBR has kept intact all tax rates, except for the final settlement ones, in the rules.
But the businesses said that the high tax rates would put extra pressure on them and these should be reduced.
Abul Kasem Khan, Chairperson of the Business Initiative Leading Development (BUILD), told The New Nation on Sunday, “The initiative of enacting new income tax law is absolutely an admirable task. But we have to understand the impact and the advantages of the new law and the rules must be simplified.”
“So far I know that there are no directions about reduction of tax rates and clear way for refunding AIT. The AIT should impose on profit instead of turnover. These are the major inconsistencies of the proposed law,” he said.
“People don’t want to pay tax for high rates and the existing high rate of tax at sources has disrupted the ease of the doing business in the country,” he said.
So, the tax rates need to be reduced in order to increase tax net and tax-GDP ratio, Abul Kasem, also former president of DCCI, said.
Otherwise, the complied businesses will be smashed and they will lose competitiveness after the upcoming LDC graduation due to the additional tax burden, he said.
Shahidul Islam, First Secretary (Tax Policy) of the NBR, recently said that they are taking opinions from the stakeholders.
The new tax law was supposed to be placed in the Parliament in this month.
