Bangladesh needs to increase tax GDP ratio to 22%: FICCI

Bangladesh needs to increase the tax GDP ratio to 22% to achieve Vision 2041, according to the Foreign Investors' Chamber of Commerce and Industry (FICCI).

The FICCI presented its proposal for preparing the National Budget 2024-255 at a pre-budget meeting organised by the National Board of Revenue (NBR) on Wednesday (7 February).

FICCI President Zaved Akhtar led the delegation including Board of Director Mohammad Iqbal Chowdhury, Executive Director TIM Nurul Kabir, and the committee members attended the Pre-budget discussion at the NBR office in the capital's Agargaon, said a press release.

NBR Chairman Abu Hena Md Rahmatul Muneem presided over the meeting while some other NBR officials were also present. 

FICCI Tax Consultant Snehasish Barua delivered a presentation outlining the chamber's budget proposals for the fiscal year 2024-25.

In the consultation with NBR, FICCI President Zaved Akhtar said FICCI, being the representative of around 210 foreign companies operating in Bangladesh, has been contributing to more than 30% of total government revenue. 

"To achieve Vision 2041, Bangladesh needs to improve its Tax GDP Ratio from the current 8.74% to 22% which is a big milestone. To achieve this target, the private sector's cooperation will be indispensable," he added.

Javed said FICCI is eager to partner in this journey and committed to contributing to the progress of the people and the country.

He said the FICCI identified the need for a comprehensive and Integrated Digital Architecture for the country to track the economic transactions and attract due to taxes from the taxpayer. 

FICCI also highlighted the immediate action to integrate already available systems such as E-TDS, Online Return, E-TIN, etc, he added.

Regarding digitalisation and integrated automation system, the FICCI President appreciated some initiatives taken by the revenue board to digitalise the regular Tax related work. 

However, he also highlighted the need for simplification of Taxation Systems and the elimination of manual processes to ease compliance and reporting. 

During the meeting to enhance the Tax Net, FICCI proposed immediate integration with all the govt agencies including City Corporations, Land Registration, etc through which the country can bring more taxpayers into the tax net.

FICCI shared its recent research report "Catalysing Greater FDI for Vision 2041: Priorities for Building a Conducive Tax System in Bangladesh" with NBR to facilitate the ongoing transformation in the Taxation System. 

The FICCI President also highlighted some recommendations from the report at the meeting such as collaboration with FICCI to work towards an integrated system that enables internal revenue mobilisation, optimise effective tax rate to enable greater FDI attraction competitiveness, simplification of Tax (Reduction of TDS and withdrawal of minimum tax) by focusing on income tax, Unified VAT rate and apply this on value addition only and ensuring faster resolution of import and exports.