90% startups dry up in 5 years due to tax burden, lack of cooperation: BCI
The trade body is also in favour of providing tax facilities to all the green factories that currently enjoy only export-oriented ones
About 90% of startups dry up within just five years of their journey due mainly to excessive tax burden and lack of cooperation from the authorities concerned, believes the Bangladesh Chamber of Industries, also known as BCI.
"The high tax rates and complex tax systems make 70% startup dropouts within three years of their beginning and 90% within five years," Anwar-Ul-Alam Chowdhury Parvez, president of the trade body, said in a press conference organised to express their reactions on the proposed budget, at its office in the capital on Saturday.
Thus, the BCI urged the government to simplify tax procedures and reduce the tax burden for newly-run businesses. It also called for framing a policy to disburse the special funds raised for them as soon as possible.
"Targets [of revenue] cannot be achieved by pressuring taxpayers. If the government can create a friendly atmosphere, the number of taxpayers can be taken to 1.5 crore by this year and revenue to Tk4 lakh crore, crossing the target of Tk3.7 crore," Anwar-Ul-Alam said.
Mentioning that their pre-budget proposals were not taken into consideration, he added that the proposed budget made the tax system more complex.
"We don't want extra privileges, rather we want to see fair practice in tax collection, like other countries."
The chamber of industries believes the proposed government borrowing of over Tk1 lakh crore from banks would have a negative impact on the growth of industries.
Increasing private sector investment, generating jobs, and collecting higher amounts of revenue as proposed in the budget are very challenging, it said and called for decreasing irregularities at production, marketing and transportation levels of food amid the ongoing global crisis of the items.
Among others, the BCI demanded keeping source tax on exports unchanged, increasing the tax-free threshold to Tk4 lakh for individuals, reducing corporate tax to 10-15% for small and medium industries, providing a five-year tax holiday for small-scale manufacturers and relieving industries from VAT on utility services.
The trade body is also in favour of providing tax facilities to all the green factories that currently enjoy only export-oriented ones, withdrawing advance tax for all the industries, digitalising the tax system and lifting minimum tax for companies.
It also urged the government to discourage people from wasting their money on luxury lighting and decoration.
BCI Vice-President Priti Chakraborty, Federation of Bangladesh Chambers of Commerce and Industry Vice-President Mostafa Azad Chowdhury Babu, and Metropolitan Chamber of Commerce and Industry President Saiful Islam, among others, were present at the event.
