Finance Minister Abul Hassan Mahmood Ali on Monday said there is nothing to be worried about, no such uncertainty and to be disappointed over the country's economy.
 
"Whatever indices we've for measuring development are now increasing, the inward remittance flow in February also witnessed an uptrend. All of our major macroeconomic indicators are now increasing. So, there is no reason for uncertainty and to be worried about and to become disappointed," he said.
 
The Finance Minister made this remarks while talking to reporters after chairing a session at the Ministry of Finance on the ongoing DC Conference held at the Osmani Memorial Auditorium in the capital.
 
He alleged that a vested quarter is spreading propaganda over the country's economy adding that BNP Secretary General Mirza Fakhrul Islam Alamgir had already mentioned that he did not see any development in the country.
 
When asked whether he had given any directive to the deputy commissioners, Ali said he had reminded the concerned deputy commissioners that Bangladesh is now standing at its highest peak in all the indicators since the country's independence under the visionary and dynamic leadership of Prime Minister Sheikh Hasina.
 
Noting that Bangladesh has now reached its highest position since independence, he said that the country is now moving forward in line with the concerned plans and the Delta Plan 2100 framed by the Awami League government.
 
"You can clearly see the gradual development of the country and the hopes garnered among people if you roam through the roads and cities. If you ride on the metro rail, then you can see how people have become happy and assured, the womenfolk are now freely traveling in the metro and they are quite happy," he added.
 
Replying to another question on the current state of inflation and the possible directive towards the deputy commissioners to rein in inflation, the Finance Minister said, "How did inflation become the major concern? There are also many things apart from it, family cards were provided to some crore people and they are getting essential commodities at subsidized prices," he added.
 
Asked whether he had given any directive to the deputy commissioners to supplement efforts for generating more revenues including income tax, Ali said, "They (DCs) will certainly cooperate more in this regard."
 
State Minister for Finance Waseqa Ayesha Khan said that the deputy commissioners have been suggested to give more importance to the priorities of the election manifesto as declared by the Awami League.
 
Replying to a question, she said that the deputy commissioners were reminded of the government's stance of pursuing austerity in all spheres of government machinery side by side ensuring strict vigilance in the implementation of the development schemes at field level.
 
Meanwhile, State Minister for Planning M Shahiduzzaman Sarker said that the Deputy Commissioners have been suggested to extend cooperation in taking up such development projects which would be beneficial for the country's people.
 
He said although it is the jurisdiction of the concerned ministries and divisions to take up development projects, it was discussed in the session that the deputy commissioners would be able to place area-wise projects if there is any such necessity and also would be beneficial for people.

MSH

Companies and organisations will be required to file tax returns on the income generated by employee welfare funds from the current fiscal year and pay a 27.5 percent tax on the earnings. 

The Income Tax Act 2023 incorporates the provision, lifting the tax exemption and amnesty on the compulsion to file returns for funds such as provident funds, gratuity funds and workers' profit participation funds maintained by the private sector.

The law, however, has exempted government-managed provident funds from taxation, raising questions.

TIM Nurul Kabir, executive director of the Foreign Investors' Chamber of Commerce & Industry, said there were many other avenues to collect tax.

"Employees benefit from provident funds after their retirement. So, the authority should not slap taxes on retirement benefit."

He said while levying the tax, the government has not treated provident funds of the private and public sectors equally.

"It is discriminatory," he said, adding that they would appeal to the tax authority for the withdrawal of the tax on income from provident funds.

Debabrata Roy Chowdhury, director for legal, regulatory and corporate affairs at Nestlé Bangladesh PLC, said the introduction of income tax on trust funds would lower the overall income from such schemes.

"This will have an adverse long-term impact on retired employees of private organisations."

Chowdhury urged the authority to address the issue in line with the spirit of the government's initiatives aimed at ensuring social security for private sector employees.

"The recent introduction of the universal pension scheme for private sector employees is a good example of that."

A senior official of the NBR, on condition of anonymity, said the income of government-managed provident funds was exempted in line with the Provident Fund Act 1925.

He said provident funds under the private sector had been historically exempted and there was no requirement to submit tax returns. As a result, it was unclear whether the funds were properly utilised.

"From now onwards, we will see proper disclosure."

The tax official said the contribution of payroll tax is about 3 percent of the total income tax although it should increase as the economy is growing.

Md Shahadat Hossain, a former president of the Institute of Chartered Accountants of Bangladesh, said income from investment in savings certificates, where people invest as a source of future earnings, is already taxed.

"From that perspective, the imposition of tax on provident and other employee welfare funds seems okay."

However, Towfiqul Islam Khan, senior research fellow at the Centre for Policy Dialogue, said social protection for private sector employees was low.

"Provident and other workers' welfare-related funds provide little social protection. The imposition of tax will increase inequality. But there can't be any discrimination in taxation between private and government provident funds."

Khan, citing the latest income tax law that replaced the Income Tax Ordinance 1984, said the NBR tried to find new avenues to increase tax collection and improve the nation's revenue-gross domestic product ratio, which is one of the lowest in the world.

"We can see the desperation of the tax authority to boost collection. This ultimately reveals the inability of the NBR to catch the tax evaders and illicit money makers."