The Institute of Chartered Accountants of Bangladesh (ICAB) has expressed concern that the imposition of capital gain tax from investment in government securities will increase the tax burden of the tax payers.
According to the new budget for fiscal 2022-2023, institutional investors, including banks, insurance and non-banking financial institutions, will face tax on their capital gains from investments in government securities such as treasury bills and bonds.
In a statement issued Thursday, ICAB President Md Shahadat Hossain also noted that the proposed budget disallowed the contributions made to a company's Workers' Profit Participation Fund.
"This will increase tax burden of the compliant businesses," he said.
Welcoming the proposed budget, the ICAB president said conditional reduction in tax rates for certain types of companies is a good initiative.
"Introduction of 12% tax rate for all other general industries exporting goods and services and 10% for green industries will encourage diversification of export of goods and services," he added.
He also appreciated the changes made in the VAT and Supplementary Duty Act.
The ICAB president said that the proposed budget is business friendly and will help Bangladesh to upgrade gradually to position itself in the middle income group.
Finance Minister AHM Mustafa Kamal has placed Tk6.78 lakh crore national budget for FY23 at Jatiya Sangsad according top priority to safeguarding marginal people from inflation fuelled by the Russia-Ukraine conflict.
This is the fourth budget of the third consecutive term of the government led by Prime Minister Sheikh Hasina and also the overall 51st budget of the country.
The proposed budget is Tk74,383 crore higher than the original budget size of the FY2021-22 fiscal year, which was Tk6,03,681 crore.