State investment promotion agencies on Tuesday called for a reduction in the corporate income tax rate and other taxes to facilitate domestic and foreign direct investment in the country.
In a pre-budget discussion with the National Board of Revenue, the Bangladesh Economic Zone Authority, the Bangladesh Investment Development Authority, the Bangladesh Export Processing Zone Authority and the Bangladesh Hi-Tech Park Authority made the claim.
BIDA sought to expand the ability to legalize untaxed money by paying just 10 percent tax to all areas of the country to attract more investment.
Currently, the benefit is only granted for investments in economic zones and high-tech parks.
BIDA said expanding the benefits across the country would help create jobs.
At the meeting, BEZA called for a reduction in corporate tax of 10 percent to 22.5 percent from the current 32.5 percent, while BIDA asked the NBR to set the tax rate at 25 percent.
Both companies reported that the corporate tax rate in the country was higher than competing countries such as Vietnam, Thailand, China, India and Malaysia, and that the difference in tax rate was an obstacle to attracting FDI into the country.
BIDA also called for a VAT exemption for locally produced capital machinery and spare parts, as well as the suspension of the provision of minimum taxes to businesses regardless of their profits and losses for the next three years in light of the fallout from the COVID-19 outbreak.
It was also recommended that section 30B of the Income Tax Ordinance be deleted in connection with compliance with the tax deduction at source.
BIDA also proposed the introduction of a common examination for income tax, VAT and customs in place of the existing separate examination system and the introduction of an electronic system for the deduction of TDS and withholding tax.
In its proposal, BEZA called on the tax authorities not to deduct the AIT when it is imported by investors at BEZA, since investors benefit from tax breaks for their income.
It also sought a long-term tax advantage for a large volume of investment in the economic zones, instead of having a similar tax treatment regardless of the volume of investment.
She also called on the NBR to increase the tax-free annual turnover for small and medium-sized companies from the current Tk 50 lakh to Tk 3 crore.
BEZA called for either the withdrawal or a reduction in VAT on leasing money that the company had received from investors in the economic zones.
BEPZA endeavored with the investors of BEZA and BEPZA to achieve a similarity in the tax exemption for income and customs duties for vehicle imports.
A special tax vacation was also recommended for diversified and non-traditional products and industries located in remote and underdeveloped areas.
The BHTPA requested a tax exemption facility for additional time for investors in the parks and a relaxation of the conditions for importing vehicles under duty-free services.
The Leading Development Business Initiative, a public-private initiative, called for a corporation tax cut from 32.5 percent to 30 percent, an additional 1 percent waiver for a certain amount of job creation, and a tax waiver on 10 percent of individual spending .
It also called for an end to the harassment of the auditing process and unnecessary audits and the expansion of the benefits of bonded warehouses to all types of exporters.
BHTPA managing director Hosne Ara Begum, BUILD chairman Abul Kasem Khan, BEZA executive member Abdul Azim Chowdhury, BIDA executive member Mohsina Yasmin and director Md Ariful Haque, BEPZA member Md Mahmudul Hossain Khan, spoke under the chairmanship of the NBR chairman Abu Hena Md Rahmatul Muneem.