The proposed budget for fiscal 2020-21 gives scope to whiten black money.
As a businessman I cannot accept this. Money turns black in two ways. Legal income becomes illegal due to non-payment of taxes. We want to legalise this money, but not at the cost of so much concession. Those of us who pay high taxes regularly will be disheartened. Those who did not pay taxes, will get the scope to whiten black money by just paying ten per cent of the taxes.
Giving scope to whiten black money by paying taxes at such low rates is a sort of punishment for good tax payers. On the contrary, illegal money is being whitened by paying ten percent of the amount. This can in no way be supported. If the scope to whiten the black money is to be given, this can be done by paying additional ten percent of taxes more than the regular taxpayers. Otherwise good taxpayers will be discouraged.
Reduction of tax at individual and corporate level has been announced in the proposed budget. This is a good initiative. People will have money in their hands and they will be able to spend. It has been proposed to reduce corporate tax by two and half per cent, but we proposed to reduce it by five per cent. And we proposed to reduce an additional two per cent tax for those who will not terminate employees and shut factories.
We pointed out if employees remain in jobs, they will get salaries. They will spend the money and the economy will remain strong. Now the big challenge is to retain employment. Under the current situation, many companies will plan to terminate employees as earnings have decreased. We will request the government again to take steps in this regard.
Money turns black in two ways. Legal income becomes illegal due to non-payment of tax. We want this money to be legalised, but not at the cost of so much concession. Those of us who pay high tax regularly will be disheartened. Those who did not pay taxes, will get the scope to whiten black money by paying only ten percent of the tax.Abul Kasem Khan
Allocation for the health sector has been increased this time. This is the best time to increase expenditure in the health sector and social safety net programmes. Certainly the government will give importance to this sector for sustainable development. Where the coronavirus situation will lead us cannot be predicted now, so the allocation in the health sector and the social safety net must be increased.
I cannot support the proposal to cut customs duty on deposits in the bank. Everyone keeps legal money in the bank, and taxes for this money is paid. Imposition of further tax on this money cannot be acceptable. People will be discouraged to deposit money in the bank if customs duty is imposed. Problems will increase if people leave banks. Rather digital transaction has to be increased by reducing cash transaction. Use of cash has to be reduced due to coronavirus.
I cannot understand why the government is cutting money from cell phones in this way. Now cell phone is of all the people, not only of the rich. The prime minister has made sure that the people own cell phones. So why is pressure is being put on the people? The use of internet is increasing. Internet has to reach everyone at low cost to ensure social distance. I hope the government will review the proposal to increase supplementary duty on cell phone services.
On the whole, I will say a good budget has been announced during the coronavirus crisis. If a number of small matters are taken into consideration, this will yield better results, especially the issue of retaining employment.
Abul Kasem Khan is former president of Dhaka Chamber of Commerce and Industry (DCCI).
*This article, has been originally published in Prothom Alo print edition, has been rewritten in English by Rabiul Islam.