Higher tax on high-income earners may increase capital flight: MCCI president

Raising the tax rate for high-income taxpayers could increase capital flight, warned Metropolitan Chamber of Commerce and Industry (MCCI) President Kamran T Rahman. He said such a move would also discourage honest taxpayers.

He made the remarks today, Saturday morning during the National Board of Revenue’s (NBR) pre-budget discussion held at the NBR Bhaban in Agargaon of Dhaka. Women entrepreneurs also presented various proposals at the meeting. NBR Chairman Md Abdur Rahman Khan assured that their proposals would be considered.

The MCCI president said that although more than 10 million (one crore) Taxpayer Identification Numbers (TINs) have been issued, less than half are filing returns, calling it a major weakness. He added that instead of increasing tax rates, expanding the tax base would be more effective.

MCCI director Hasan Mahmood called for a 2.5 per cent reduction in corporate tax and also said that there should be no minimum tax rate.

The Women Entrepreneurs Association of Bangladesh also raised demands to improve benefits for women entrepreneurs. Its president Nasreen Fatema Awal called for a 3–5 year tax holiday for women entrepreneurs, along with training programmes on taxation.

At the event, the NBR chairman proposed introducing a fixed VAT rate for women entrepreneurs, saying, “Then you will no longer need to submit VAT returns.”