{"id":33715,"date":"2017-06-01T05:03:46","date_gmt":"2017-06-01T05:03:46","guid":{"rendered":"http:\/\/en.bornomalanews.com\/?p=33715"},"modified":"2017-06-01T05:03:46","modified_gmt":"2017-06-01T05:03:46","slug":"tax-net-likely-to-widen","status":"publish","type":"post","link":"https:\/\/en.bornomalanews.com\/?p=33715","title":{"rendered":"Tax net likely to widen"},"content":{"rendered":"

\"Muhit-Budget1\"Dhaka: All eyes will be on finance minister AMA Muhith today as he places the highest ever national budget of over Tk. 400,000 crore in Parliament. Of particular interest to the nation are his expected proposal on the value added tax (VAT), the reformation of different policies, and the new excise duty and income tax structures. On May 11, Muhith warned that people would have to pay higher tax from the next fiscal year. \u201cI believe the people are now capable of paying higher taxes,\u201d he said, admitting that the proposed tax structure would affect them.<\/p>\n

The 46th budget of Bangladesh will be placed at 1.30pm today. Muhith will be the first finance minister to place the national budget 11 times, and for the third time for two consecutive terms of the Awami League (AL) government. He will make a PowerPoint presentation of the proposed budget. On condition of anonymity, economists commented that it was likely to be a usual budget, without any surprises. The business community is worried about the VAT proposal.<\/p>\n

The finance minister had earlier promised to reduce the VAT. But he made a U-turn on May 27 and decided to retain the existing 15 per cent VAT in the next budget. \u201cThe 15 per cent uniform VAT will not affect the prices of essentials, as many necessary items will be kept out of its purview,\u201d he claimed.<\/p>\n

Common people, particularly those with small savings, are worried, as the government is set to hike excise duty on deposits in banks and financial institutions by up to 100 per cent in the national budget for the next fiscal year of 2017\u20132018.<\/p>\n

Muhith is expected to make the proposal in his budget speech, said officials of the finance ministry.<\/p>\n

According to ministry sources, the excise duty may be raised to Tk. 200 a year from the current Tk. 150 if the account balance is between Tk. 20,000 and Tk. 1 lakh any time during the year. A balance below Tk. 20,000 will be exempted from the excise duty.<\/p>\n

For a balance of Tk. 100,001 to Tk. 10 lakh, the payable excise duty may be increased to Tk. 1,000 a year from the existing Tk. 500. The duty may be hiked to Tk. 3,000 for balance between Tk. 1,000,001 and Tk. 1 crore from the current duty of Tk. 1,500.<\/p>\n

Account holders may have to pay Tk. 15,000 a year as excise duty instead of Tk. 7,500 for balance between Tk. 10,000,001 and Tk. 5 crore. For a balance of Tk. 50,000,001 and above, the excise duty rate may be increased to Tk. 30,000 from the existing Tk. 15,000 in the next fiscal year.<\/p>\n

Also, the government is set to fix a tax revenue target for the next fiscal year, which will be 34 per cent higher than the revised targets for the current fiscal year (2016\u201317). The proposed tax collection target for the National Board of Revenue (NBR) is likely to be set at Tk. 248,000 crore for FY 2017\u201318.<\/p>\n

The government expects a substantial boost in VAT collection with the implementation of the new VAT and supplementary duty (SD) law from July 1. Earlier, Muhith had said it would be a little over Tk. 4 lakh crore.<\/p>\n

\u201cI will not disclose the exact figure,\u201d he had said, adding, \u201cWe will increase the allocation for human resource development in the budget compared with previous years. But the allocation for the agricultural sector will remain the same.\u201d<\/p>\n

The government is set to fix the highest target for VAT, followed by income tax and customs duty in the upcoming FY. The VAT collection target might be set at Tk. 87,887 crore, while the target for the current fiscal year was Tk. 72,764 crore.<\/p>\n

The income tax wing might have to collect Tk. 86,867 crore in the upcoming budget. The target for income tax collection in the current fiscal year was Tk. 71,940 crore.<\/p>\n

The tax revenue collection target for the customs wing might be set at Tk. 73,436 crore. It was Tk. 55,670 crore in the current fiscal year.<\/p>\n

The government is also likely to increase the ceiling for tax-free income from the present Tk. 2.50 lakh to Tk. 2.75 lakh, NBR sources said. The proposed move comes in the wake of demands from taxpayers and trade bodies for adjusting the threshold of annual inflation and the living conditions of the people.<\/p>\n

Sources said though a significant number of taxpayers might go out of the tax net following the raised ceiling, the government may decide to give them relief as the threshold has remained unchanged for the last two years. The government had last increased the ceiling for tax-free income from Tk. 2.20 lakh to Tk. 2.50 lakh in FY 2014\u201315.<\/p>\n

The government did not raise the ceiling in the last two years to widen the tax net, even though the annual average inflation rate rose above 5.6 per cent during that period, trade bodies claimed.<\/p>\n

NBR sources said the tax-free ceiling for women, elderly citizens, people with disabilities and freedom fighters will also be raised.<\/p>\n

At present, the tax-free income ceiling is Tk. 3 lakh for women and senior citizens, Tk. 3.75 lakh for people with disabilities, Tk. 4 lakh for parents of children with disabilities and Tk. 4.25 lakh for freedom fighters.<\/p>\n

The minimum income tax, however, may remain unchanged at Tk. 5,000, Tk. 4,000, and Tk. 3,000 for taxpayers living in areas falling under city corporations, districts and upazilas respectively.<\/p>\n","protected":false},"excerpt":{"rendered":"

Dhaka: All eyes will be on finance minister AMA Muhith today as he places the highest ever national budget of over Tk. 400,000 crore in Parliament. Of particular interest to the nation are his expected proposal on the value added tax (VAT), the reformation of different policies, and the new excise duty and income tax […]<\/p>\n","protected":false},"author":7,"featured_media":33716,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[12],"tags":[],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\n\n\t\n