High bank borrowing to shrink private sector credit: AK Azad
He opposes black money whitening
Dhaka, June 8 (UNB) - The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) on Friday voiced deep concern over a number of budget proposals including tax at source and government’s bank borrowing.
“We apprehend that too much dependence by the government on bank borrowing will increase liquidity crisis and it’ll have negative impact on required credit flow to the private sector,” FBCCI president AK Azad said while making official reaction at a press conference at its conference room.
Finance Minister AMA Muhith in his budget speech in Parliament on Thursday mentioned the government’s target of borrowing from the banking sector at Tk 23,000 crore to meet the budget deficit.
Azad expressed frustration over the sharp hike of tax at source on all types of exports. “It’s the most frustrating one among the direct-tax related proposals,” he said.
Under the new budget, tax at source on all types of exports has been proposed to be doubled to 1.2 percent from 0.60 percent.
On black money issue, the FBCCI chief said the black money whitening provision will discourage businesspeople to pay tax regularly. “It’s discriminatory for the honest taxpayers.”
He said five major reasons -- Eurozone crisis, negative trend in export earnings, fall in foreign aid flow, government bank borrowing, and soaring inflation -- might hamper the economic growth.
He also expressed dissatisfaction over keeping the tax-free income ceiling unchanged despite demands from various quarters to raise it considering the soaring inflation.
Azad, however, appreciated a good number of proposals made for human resource development, increasing the number of beneficiaries of social safety net programmes, rural development, women development, and duty reduction on import of capital machineries and ETP equipments.
“We apprehend that too much dependence by the government on bank borrowing will increase liquidity crisis and it’ll have negative impact on required credit flow to the private sector,” FBCCI president AK Azad said while making official reaction at a press conference at its conference room.
Finance Minister AMA Muhith in his budget speech in Parliament on Thursday mentioned the government’s target of borrowing from the banking sector at Tk 23,000 crore to meet the budget deficit.
Azad expressed frustration over the sharp hike of tax at source on all types of exports. “It’s the most frustrating one among the direct-tax related proposals,” he said.
Under the new budget, tax at source on all types of exports has been proposed to be doubled to 1.2 percent from 0.60 percent.
On black money issue, the FBCCI chief said the black money whitening provision will discourage businesspeople to pay tax regularly. “It’s discriminatory for the honest taxpayers.”
He said five major reasons -- Eurozone crisis, negative trend in export earnings, fall in foreign aid flow, government bank borrowing, and soaring inflation -- might hamper the economic growth.
He also expressed dissatisfaction over keeping the tax-free income ceiling unchanged despite demands from various quarters to raise it considering the soaring inflation.
Azad, however, appreciated a good number of proposals made for human resource development, increasing the number of beneficiaries of social safety net programmes, rural development, women development, and duty reduction on import of capital machineries and ETP equipments.
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