Dhaka, Jun 2 – The Foreign Investors’ Chamber of Commerce and Industry (FICCI) on Friday expressed its concern over a number of proposals made in the new budget and demanded addressing their concerns with necessary amendments.“The Chamber feels that the proposed budget with necessary amendments will accelerate investment, improve the business environment and socio-economic condition of the country,” it said in a reaction to the 2017-18 national budget proposals.
The Chamber expressed its concern over the continuation of Supplementary Duty (SD) on locally-manufactured products and ‘discriminatory provision’ for locally-registered foreign companies’ manufactured product prices and SDs in context with local companies in the new VAT Act.
Restriction on the closing balance of the current account in case of litigation, enhancement of the rate of Excise Duty on bank account balances, fixation of withholding VAT at the rate 1/3 of 15 percent from non-deducting authority, continuation of VAT on spectrum fees, which is not in practice anywhere in the world, and continuation of SIM tax are also mentioned as their areas of concerns.
The Chamber also noted that non-reduction of corporate tax rate, continuation of threshold of perquisite and royalty and technical knowhow fees disallowances and in spite of inflation no changes in individual tax exemption limit for the last two years as their concerns.
The Chamber, however, appreciated a number of measures in the proposed budget, including introduction of online VAT system with effect from July 1, withdrawal of the provision for the deduction of tax on the direct materials that constitute cost of sales or cost of goods sold and provision for the adjustment of AIT deducted at import stage against the deductible tax at selling stage.
Steps like simplification of the procedures of tax deduction and tax collection on certain services and fees and commission, alignment of the income year of the subsidiary of foreign companies and branches, increasing the scope of the requirement for submission of e-TIN and introduction of computer generated notice and order and filing of return were appreciated by the Chamber. – UNB
