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Business people have asked the government to impose VAT on only the amount of value addition of any product instead of its total price to encourage them to pay tax properly.
They made the call at a virtual dialogue on “Local Market Development: Preparedness for Post-LDC Era” organised by the Dhaka Chamber of Commerce & Industry (DCCI) on Saturday.
“The local market has spread vastly. All our entrepreneurs want to pay VAT and tax properly if it is imposed on profits. The NBR can impose VAT at 15 per cent or 10 per cent. Otherwise, it will be tough to run our business,” said Mirza Nurul Ghani Shovon, President of the National Association of Small and Cottage Industries of Bangladesh.
“We won’t have to depend on only export. We can earn more from the local market too as it has widened far. We have to catch the market,” he added.
“The government announced Tk 20,000 crore intensive for the cottage, micro and small enterprises but it is yet to be implemented for
some financial institutions. Bangladesh Bank said they disbursed 75 per cent of the amount but I don’t agree with it. They included other loans with the incentive too. I think all loans should be given among all new, old and Covid-affected people in CMSEs sector,” he added.
There is data scarcity in the SME sector and SME entrepreneurs should be skilled in technology, he said. “We need access to credit, market, develop human resources, and coordination among ministries and chambers,” he said.
DCCI president Rizwan Rahman said like the RMG sector Bangladesh could earn billions of dollars from other sectors if the sectors could be nurtured properly.
“There is a need to reform duty and tax structure, lay emphasis on good manufacturing environment, change consumer behaviour. We should make the supply chain ecosystem more competitive,” he said.
Rizwan added that issues of developing local businesses, boosting local manufacturing capacity, and increasing product quality should be addressed as the entire market scenario would change after LDC graduation.
Chairman and CEO of Pran-RFL Group Ahsan Khan Chowdhury said, “A positive mindset is needed to extend business. Besides, bottlenecks should be resolved and skilled human resources should be developed. Productivity is our big barrier. It has to be increased to go to the global market.”
Dhaka University professor Dr M Abu Eusuf laid emphasis on creating productive graduates. “Besides, we must emphasise using modern technology. A decent work environment at workplaces is necessary,” he said and stressed resolving the issue of data scarcity.
Commerce Secretary Tapan Kanti Ghosh said Bangladesh would face some challenges after LDC graduation. “Earlier, backward linkage
industries could export in zero duty. But, we have to pay high duty after 2026. We have to enter the market paying full duty. There is a big competition now. If we would like to sustain our trade, then we have to embrace an open market system,” he added.
“We have problems in ease of doing business. We have to protect local SMEs and make the process easy for business people. Domestic industry must be strengthened,” he added.
Tapan Kanti mentioned that RFL and Walton did not get cash incentives at the beginning but now they have expanded their businesses.
“Now we are giving more facilities to businesses. However, we have to increase our efficiency, improve ease of doing business indexes, skill up human resources. Businesses should seek simplification of the business process instead of cash incentives. We will provide all policy supports to boost the business,” he added.
The DCCI also arranged a meeting commemorating Anwar Group of Industries chairman Anwar Hossain who passed away August 17.
