Apparently plunged in unprecedented catastrophe over COVID 19 pandemic that caused deaths of thousands of human life and huge economic loss, the governments across the world have announced various stimulus packages and Bangladesh is not a difference.
Of various stimulus programmes, the government’s announced Tk 5000 crore package for export-oriented industries for meeting salary of workers would put a very positive impact on the country’s economy, especially the highest export-earning sector, economic analysts made this view.
Business Initiative Leading Development (BUILD), a think-tank of the country’s leading business chambers in a statement issued on Tuesday said, urged the government to take necessary measures to reduce income tax and corporate tax rates by 5 percent across all sectors.
Besides, it sought additional tax relief for business connected with its past tax payments records for minimum 3 years. In addition, it urged the government to introduce delayed tax payments process so that business and industries as well as individuals do not fall under financial difficulties.
For this, the National Board of Revenue (NBR) should consider postponing collection of taxes for 2 quarters and no charges of any tax delays, zero demurrage charge on import and other relief needs to be given to businesses particularly for SMEs.
Safeguarding employment is an important challenge for the government, BUILD said adding the government must ensure businesses do not cut jobs due to the economic down turn through developing some mechanism. Additional 2 percent tax relief must be offered to firms where there is no job loss for the next one year.
Government should increase spending on research and development including health services should be encouraged in the budget for the coming year. 2 percent of gross revenue of a company should be allowed for investment in R&D, Innovation, Health Costs, Training, SDG etc. It is also vital to encourage PPP models for setting up hospitals and clinics in the upcoming budget with special support in allocating land, said the think-tank.
It, however, appreciated the Bangladesh Bank for taking some policies for loan classification and relaxation of Foreign Exchange Regulations for trade transactions.
The global economy is largely facing disruption due to this unprecedented disruption by the outbreak of coronavirus. Countries across the global are facing a risk of an outright disintegration as global supply chain is becoming quite delinked and disengaged. Now, the global connectivity is literally handicapped. Most of the business are closed to shutdown of an indefinite period. The most shocking part is job loss is feared across every sector.
Uncertainties are mounting as households and businesses are facing liquidity crisis. As we move into further uncertainty, falling demand is affecting supply chain both locally and internationally. Government policies need to be devised to keep the economy with various mechanisms at its disposal. Today, our public borrowings have increased in recent years and liquidity crisis has its limitations within our financial systems, therefore with the limited resources, our policy planners need to plan accordingly to have a balance approach. Adequate resource allocation will be needed to reallocate funds to the critical areas of the economy keeping in mind the objectives of saving lives to saving livelihood.
