MCCI chief seeks supportive, growth-oriented budget
The MCCI chief urged the government to reconsider conditions tied to corporate tax benefits, especially restrictions on cash transactions, saying many businesses are unable to avail themselves of reduced rates due to practical limitations.
Metropolitan Chamber of Commerce and Industry (MCCI) President Kamran T Rahman today (19 April) called for a "supportive and growth-oriented" national budget for fiscal year 2026-27, warning that businesses, particularly small and medium enterprises, are under severe strain from high inflation, sluggish investment, elevated interest rates and foreign exchange pressure.
Speaking at a joint seminar of MCCI and the Economic Reporters' Forum (ERF) on budget priorities, he said the upcoming budget must be balanced and realistic, arguing that a sensible tax policy can simultaneously boost revenue, encourage investment and generate employment rather than punish businesses further.
Kamran proposed full integration of the National Identity (NID) and Tax Identification Number (TIN) databases to expand the tax net, noting that though over one crore taxpayers hold TINs, fewer than half file returns.
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He also recommended introducing a symbolic minimum tax to bring new taxpayers into the fold and simplifying return filing through mobile applications.
The MCCI chief urged the government to reconsider conditions tied to corporate tax benefits, especially restrictions on cash transactions, saying many businesses are unable to avail themselves of reduced rates due to practical limitations.
He further suggested cutting tax rates for both listed and non-listed companies by an additional 2.5% to stimulate investment.
Kamran proposed a unified taxpayer profile covering income tax, VAT and customs to reduce administrative complexity and harassment, along with online hearings and digital notices to cut time and cost for businesses.
On VAT and customs, he recommended simplifying procedures, ensuring valuation based on transaction value, strengthening automation and allowing disclosure of quantity instead of value in certain VAT forms to protect business confidentiality.
The MCCI President called for special policy support for SMEs, including separate tax treatment, input tax credit facilities and reduced duty and VAT on raw materials.
Comprehensive reform roadmap presented
The policy recommendations were formally presented by Md Shahadat Hossain, former President of the Institute of Chartered Accountants of Bangladesh (ICAB), through a paper titled "National Budget 2026-2027: Private Sector Priorities & Perspectives", which laid out a wide-ranging roadmap covering corporate tax, VAT, customs and capital market reform.
Shahadat said the national budget should be seen not merely as a revenue-and-expenditure statement but as a comprehensive policy framework encompassing economic growth, investment, employment and inflation management.
He flagged Bangladesh's tax-to-GDP ratio hovering between 6.5% and 7.3% in FY2024-25 as among the lowest globally, well below the 15% threshold considered necessary for sustainable development.
Shahadat noted that around 66% of total tax revenue comes from indirect taxes, disproportionately burdening lower-income groups and widening inequality.
On corporate tax, the paper recommended rates of 20% for publicly traded companies with a minimum 10% IPO, 22.5% for those with less than 10% IPO, 25% for non-publicly traded firms, 20% for one-person companies, and 25% for trusts, associations of persons and firms.
For individuals, it proposed a tax-free threshold of Tk 5 lakh, with graded rates from 5% to 30% on higher income slabs.
The paper also called for rationalising withholding taxes, including a 0.3% tax on gross receipts, TDS on supply between 1% and 3%, and import-stage tax reduced from 5% to 3% to ease compliance and prevent double taxation.
On administration, the recommendations included limiting reopening of tax files to within six years, prohibiting estimated profit assessments, mandating written reasons for disallowances, and digitising hearings and notices.
On capital markets, the paper stressed reducing overdependence on bank financing and proposed tax exemptions on zero-coupon bond investments, tax-free capital gains on treasury instruments in secondary markets and removal of the super tax on stock dividends.
Shahadat concluded that Bangladesh stands at a critical juncture, and that a budget reflecting private sector priorities will broaden the tax base, reduce compliance burden, attract investment and strengthen investor confidence.
