Dhaka Chamber of Commerce and Industry (DCCI) thinks that a planned, timely, cost-efficient and implementable budget is more effective than a big budget.
Rizwan Rahman, president of the DCCI, said this on Thursday in his initial reaction on the proposed budget for fiscal year 2022-2023, read a press release.
The implementation of the budget was a great challenge, he said.
Enhancing private sector investments, employment generation, and revenue shortfall and financing were some of the challenges of the proposed budget, he elaborated.
The inconsistency between income and expenditure in the proposed budget may lead to dependency on bank loans or borrowing from foreign sources, according to the DCCI.
In order to attain the targeted GDP, the government required to focus on widening tax net gradually, automation of tax structure, fixing up rational target of revenue collection and consistency of the government expenditure, said the business chamber.
Since the middle and lower middle income people of the society were facing the pressure of inflation, taking it into consideration, the limit of individual income tax could be increased, it further said.
However, few slabs could be created for the higher-income group but obviously in a rational manner, the DCCI suggested.
Listed companies offloading more than 10 per cent of their paid-up capital to the market through IPO only can avail the opportunity of giving 20 per cent corporate tax.
Both listed and non-listed companies, who have cash expenditure or investment of Tk12 lakh annually and do transactions through banking channel, are eligible to give 20 per cent corporate tax.
If any listed company fails to comply with these two conditions, they will have to pay 25 per cent corporate tax.
The Dhaka Chamber feels that the threshold or limit in the conditions is very insignificant.
Moreover, corporate tax rate should be reduced to be more competitive not only in the international market but also in local market.
"This year from July to May our export earning was $47.17 billion against import expenditure of $68.87 billion. Trade deficit is $21.7 billion. It seems that our import expenditure is higher than the export earnings," reads the press release.
The higher import expenditure was not good for international trade, it said.
Export diversification needed to be promoted, the DCCI said.
Equal corporate tax for readymade garment (RMG) and non-RMG export sectors will facilitate diversification process.
The business chamber further said 24.9 per cent investment from the private sector is targeted. But for that, private sector credit flow should be increased.
"The ADP implementation till May 2022 was 58.36 per cent, which is not satisfactory," said the DCCI president.
Mega infrastructure projects should be completed at a faster pace but in a lower price ensuring transparency and accountability, he said.
"Clause number 83, 84 and 100 of goods seize provision need to be reformed," Rizwan Rahman added.
He also requested to formalise facebook based entrepreneurs.