BUILD for raising tax-free income limit to Tk4 lakh

The government could consider raising the tax-free income limit to Tk4 lakh amid rising costs of living, Business Initiative Leading Development (BUILD) said in its budget reaction. 

This raise could at least protect the buying capacity of the low-income group to some extent amidst the spiralling inflation, it said further in a press release on Saturday.

The tax-free income limit remains unchanged at Tk3 lakh. It means if a person's monthly income is more than Tk25,000 in the fiscal year 2022-2023, she/he will have to pay income tax.

The total layout of the proposed budget for FY 2022-2023 is Tk678,064 crore, while the 8th Five Year Plan projected that the budget size of the fiscal year would be Tk7.92 lakh crore.

It shows that the government remained very cautious in not increasing the budget expenditure too much, irrespective of the 8th FYP budget projection, according to the BUILD.

The BUILD appreciated the priorities set in the budget such as containing inflation, ensuring food security, human resource development, boosting domestic investment, promoting exports and export diversification, job creation and tackling climate change effects.

However, the government needs clear strategies to address the inflation, said the organisation. 

The BUILD also congratulated the government and the finance minister in particular for announcing the budget during the difficult time of a global crisis and the 3rd wave of Covid-19.

It appreciated the government for its policies on – VAT, Simplification of Renewal of Bond, income tax and customs.

Besides, it also appreciated encouraging API production and textile grade pet chips manufacturing and projects for strengthening storage capacities to ensure food security. 

The government has recently introduced the Digital Commerce Business ID (DBID) issued by the Registrar of Joint Stock Companies (RJSC) for restoring public confidence in e-commerce sites and protecting consumers' interests. 

However, it was not clear in the clause whether DBID will act as a substitute for a trade license for e-commerce entrepreneurs, said the BUILD. 

"It is not even clarified either that DBID-certified entrepreneurs will be eligible for bank loans as well," the BUILD added.