Tuesday, 5 July, 2022

ICAB terms budget investment-friendly

The inclusion of start-ups in tax structure will encourage the youth in innovative businesses, it says.

  • Staff Correspondent
  • 12 June, 2022 12:00 AM
  • Print news

Institute of Chartered Accountants of Bangladesh (ICAB) welcomed the proposed budget for the FY 2022-23 as “investment-friendly” that offers favourable tax structure considering the current global situations.

“The proposal of 12 percent tax for product and service exporters will attract the investment in international trade while the provision of 10 percent tax for green business will encourage the entrepreneurs in sustainable business model,” Shahadat Hossain, president of ICAB, told the journalists in a post-budget reaction on Saturday.

The national-level professional accounting body’s budget reactions echoed the finance minister’s briefing the previous day. ICAB president read a written statement during the press conference while CEO Shubhasish Bose made the address of welcome.

In his speech, Fellow Chattered Accountant Shahadat Hossain said that the government accommodated almost all recommendations from the ICAB in the proposed budget.

“The inclusion of start-up in tax structure will act as inspirational factor for the young generations in innovative businesses. It will also attract more foreign direct investment,” he said.

ICAB suggested widening the tax net to reduce the pressure on middle-income group.

“We believe the joint initiative of ICAB and NBR to file verification will help the government increase revenue collection in the upcoming fiscal year,” Shahadat Hossain added.

ICAB former president Humayun Kabir said, “The budget has a couple of challenges. However, we believe all the projections are achievable by the end of the fiscal with a mid-term review.”

“The present inflationary pressure is not an internal issue. It’s a result of global supply chain disruption. We believe that the challenges will be overcome after six months,” he added.

Regarding the inclusion of start-ups, the fellow chattered accountant said, “There is no chance to mix SME with start-ups as the revenue board defines ‘startup’ with special indicators.”

The issue of amnesty for money launderers was also raised.

According to the proposed provision in the draft budget, no authorities, including the income tax authorities, will raise any question as to the source of any asset located abroad if a taxpayer pays tax on such assets.

Fellow Chartered Accountant Snehasish Barua said, “The proposal to report global assets in Bangladesh tax return will align us with global tax practice.”

“US residents need to do FATCA reporting. As per our tax law, a resident taxpayer is supposed to pay tax on global income. Hence, the related assets should have been reported in their wealth statement,” he said.

He added, “So, the amnesty will allow them to show their assets in their tax returns. They will be challenged if they fail to report so.”

Snehasish Barua thinks that it is tough to estimate as to how many people will bring the money within 30 June 2022 but at least they will be incentivised with the reduced tax.

ICAB was established under the Bangladesh Chartered Accountants Order, 1973 (President's Order No. 2 of 1973) for the purpose of regulating the profession of accountants and for matters connected therewith.