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Muhith hints at reducing tax rates in next budget

muhitThe government is planning to bring the largest possible number of people within the tax net this year by reducing the tax rates.
Finance minister Abul Maal Abdul Muhith confirmed this at the 36th consultative meeting on the upcoming budget, organised by the National Board of Revenue (NBR) and the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI), at a city hotel yesterday. He was speaking on the 2015–16 budget, which will be announced on June 4. “The government aims to expand the budget to provide more services to the people. The revenue collected from 1972 to 1983 had increased by only 3 per cent, but this figure has significantly increased within the last six years. We’re optimistic that Bangladesh will experience a further revenue boost of 3 to 4 per cent more within the next four years,” said the minister. 
“The revenue collected during the last fiscal year was 11 per cent of the total Annual Development Programme (ADP), which is way higher than the 8 per cent in 2008. It implies that we’ve come closer to our goal to become a middle-income country within 2021,” he added.
The minister affirmed that the number of taxpayers would increase very soon. “Although we’ve 20 lakh registered tax payers, only 11 lakh people pay their taxes, which is not good for the economy,” he pointed out.
Talking about the value-added tax (VAT) law, the minister said, “We’ll implement the VAT law within the next year and the process has already been started. Also, we’ll reduce pressure on tobacco companies and will follow the system enforced by developed countries.”
NBR chairman Md Nojibur Rahman said, “We’re implementing the ‘Annual Performance Agreement’ to ensure good governance and modern management in the economic sector. We’re trying to increase the number of taxpayers to lessen the tax burden on the common people.” 
“We discussed with representatives of many trade bodies on 12 major sectors, including the service sector, export sector, business, agriculture, electronics and other economic sectors, as we’re working relentlessly to place a people-oriented budget in the upcoming fiscal year. The discussions were held from April 1 to May 9,” he added.
Atikul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said, “Accord and Alliance have been introduced in our country for garments workers’ safety as well as for building safety. We appreciated the initiatives, but now we’re being pressured to import fire doors from foreign agencies.”
The Alliance for Bangladesh Worker Safety (AFBWS) is a group of 26 major global retailers formed to develop and launch the Bangladesh Worker Safety Initiative, a binding, five-year undertaking with the intent of improving safety in Bangladeshi readymade garments (RMG) factories. Again, the Accord on Fire and Building Safety in Bangladesh is a five-year legally binding agreement between international labour organisations, non-governmental organisations, and retailers engaged in the textile industry to maintain minimum safety standards in the textile industry.
Abdus Salam Murshedy, president of the Exporters’ Association of Bangladesh, said: “We’re facing many obstacles in the export sector and our price capacity has been decreasing. Business has suffered due to frequent political problems. We want something positive in the upcoming budget to cover the losses.”
He also requested the finance minister to consider a reduction in the source tax.
MA Mannan, state minister for finance, attended the second session of the programme as a special guest. “We’ll check the issue of Accord and Alliance,” he said.
He also promised to consider different issues raised by business leaders at the programme and requested the NBR chairman to recheck those issues before announcing the budget.
Earlier, a number of business leaders had mentioned their expectations by referring to different problems in their sectors regarding tax, VAT and infrastructure issues at the programme.