The FBCCI, the apex body of traders in the country, has urged bringing a major reform in the country's tax regime to ensure time-befitting tax measures.
As part of the reform, it suggested shifting the authority of framing fiscal measures from the National Board of Revenue (NBR) to Bangladesh Trade and Tariff Commission (BTTC).
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) has demanded the withdrawal of 3 per cent advance tax in the industrial sector.
The FBCCI has suggested bringing the BTTC under the Internal Resources Division (IRD) of the Ministry of Finance.
The FBCCI has also requested to bring down the corporate tax rates for banks, insurance and other financial institutions to 35 per cent from 37.5 per cent.
The BTTC would be able to act as an executive regulatory authority like other regulatory commissions, it argued in a post-budget proposal.
The federation chamber sent the proposal on Sunday to finance minister AHM Mustafa Kamal and NBR chairman Abu Hena Md Rahmatul Muneem and requested for their appointment to discuss the issues.
It also referred to an NBR order issued in 2008 as well as budget proposals in this regard it had submitted in 2009, and demanded its immediate implementation.
The trade body suggested forming a National Trade Facilitation Commission by empowering the BTTC to reform tax measures and rationalise the tax structure. Currently, the BTTC is a wing under the ministry of commerce (MoC).
It suggested collecting tax only on the accounting profit of the taxpayers that could be adjusted with the actual payable tax, withdraw 20 per cent Advance Tax on import and impose Advance Income Tax at 3.0 per cent for commercial importers.
To enhance tax compliance, the trade body proposed to make submission of evidences or documents of tax payment mandatory for obtaining different services from public and private sector along with the current provision of submitting Taxpayers Identification Number (TIN).
In a letter to the NBR, the FBCCI further said that there is unequal competition between those who import bicycles and bicycle parts, those who manufacture and manufacture bicycles in the country. This unequal competition must be overcome.
At present, those who import bicycles and bicycle parts have to pay only 5 per cent income tax at source.
On the other hand, those who manufacture and manufacture bicycle parts in the country have to pay double tax.
There is a 3% value added tax on all types of yarn. The FBCCI wants to withdraw it.
The organization has proposed to completely remove the supplementary duty imposed on the production and supply of domestic tiles and sanitary products, and to fix 10 percent corporate tax on companies involved in the export of plastic products.
The FBCCI has proposed to set up income tax and VAT offices at the upazila level to increase the government's revenue collection as well as the tax-to-GDP ratio.
According to the organization's proposal, TIN numbers are now used in various government and non-government activities.
Proof of payment along with TIN number should be made mandatory.
The FBCCI demands, prepared on the basis of the proposed budget for FY2021-22, also included short, medium and long-term fiscal measures.
