Suggesting formulating a CMSME friendly tax structure, the Dhaka Chamber President Ashraf Ahmed on Wednesday said that complicated tax management system hinders the businesses of CMSMEs that ultimately fall impact on growth.
The President of Dhaka Chamber of Commerce & Industry (DCCI) Ashraf Ahmed was addressing a view exchange with the Chairman of National Board of Revenue (NBR) Md. Abdur Rahman Khan, FCMA at his NBR head office at Agargaon.
He said, as per the existing law, if the business losses cannot be adjusted with the income of other sources of the venture, the burden of additional tax is being imposed on the businessmen, for this purpose, he recommended the reinstatement of similar provision of Section 37 of the Income Tax Ordinance 1984.
The DCCI president also requested for the income tax system to be brought under the automated system with the aim of simplifying tax payment and all tax related matters. Ashraf pointed out that if the tax at source is not possible to be adjusted with the installment of advance income tax at this moment, the provision may be issued to provide an opportunity to carry forward the tax at source deducted from the payment of goods and services provided by the MSME to the next tax year along with the income tax. NBR Chairman Md. Abdur Rahman Khan said that only 5% of our total populations pay tax, whereas in India the rate is 23% and in existing reality we have no option to expand the tax net.
The NBR Chairman further said that the maximum revenue comes from the existing tax payers and a large section of the society is out of the tax net, thereby increasing the pressure on the existing tax payers.
If the non-tax payers remain out of the net year after year, the existing tax payers will be discouraged from paying tax, so the NBR will work on priority basis to expand the tax net in the next six months, he said.
He further said that due to multiple tax layers at various stages, effective tax rate especially of corporate tax sometimes increases, but the issue will be considered seriously by the NBR.
Without reducing tax collection target, the revenue management of the country will be streamlined along with rationalizing the tax rate, he added. The NBR chairman calls upon the business community to maintain the transaction process through cashless recordable system and banking channels which will help prevent TAX or VAT evasion.
DCCI Senior Vice President Malik Talha Ismail Bari and Vice President Md. Junaed Ibna Ali, Members of NBR Md. Masud Sadiq, AKM Badiul Alam and G M Abdul Kalam Kaikobad were also present on the occasion.
