DCCI president Osama Taseer seen at a press meet to disseminate 'DCCI's Yearly Work Plan-2019' and formal introduction of newly formed DCCI board of directors with the journalists at the chamber headquarters in the city on Wednesday Business leaders have called on the government to gradually slash the corporate tax, introduce multiple rates of VAT and take effective steps to recover non-performing loans (NPLs).
They also placed several suggestions to ensure a stable banking sector.
The suggestions include establishing an independent banking commission, financing the small and medium-sized enterprises (SMEs) at a single digit interest rate and prioritising due diligence by commercial banks in managing NPLs.
Leaders of the Dhaka Chamber of Commerce & Industry (DCCI) made the call at a press meet at its headquarters at Motijheel in the city on Wednesday.
The 'DCCI's Yearly Work Plan-2019' was disseminated and the newly formed DCCI board of directors was introduced at the meeting, with DCCI President Osama Taseer in the chair.
DCCI senior vice-president Waqar Ahmad Choudhury, vice-president Imran Ahmed, acting secretary Joynal Abdin and directors Enamul Haque Patwary, Ashraf Ahmed and Rashedul Karim spoke on the occasion.
About the banking sector, DCCI President Osama Taseer said the total volume of NPLs stood at Tk 993.71 billion as of September 2018, the highest ever in the country's history, making up 11.45 per cent of the total outstanding loans.
Serious concerns have been raised about the quality of loans being disbursed, as industrial loans account for 44 per cent of total defaulted loans, he said.
The high volume of NPLs is a major reason behind the high interest rate, he added.
Responding to questions about the approval given to three new banks, Mr Taseer said, "We should wait until time comes before making any comments on whether new banks are good or bad for the market."
To facilitate businesses, the DCCI expects, the government should take initiatives to implement the bank industry's pledge to lower the interest rate to a single digit, he said.
He also emphasised the need to form an independent banking commission to oversee the banking sector's operation, monitor large loans and strengthen the monitoring tools of financial institutions.
Giving a presentation, the DCCI president proposed reducing corporate tax progressively by 5.0 per cent, 7.0 per cent and 10 per cent in 2018-19, 2019-20 and 2020-21 respectively.
Explaining the benefits of corporate tax cuts, he said the amount thus being saved can be invested in skill development, infrastructure fund and research and development (R&D).
Proposing multi-stage VAT rates for different types of businesses, he said the value added tax (VAT) rate should be fixed at 7.0 per cent in general.
Emphasising the need to ensure transparency and accountability in VAT collection and introduce automatic tax return submission, Mr Taseer said the National Board of Revenue (NBR) should broaden its tax net, as not all eligible taxpayers are paying taxes.
He pointed out that there are around 0.8 million business identification numbers (BIN) in the country, but a significant number of them remains out of the tax net.
Bangladesh ranked 65th, out of 155 countries in Ease of Doing Business index in 2006, but the position slipped to 176, out of 189 countries, in 2019, he said, adding that the One Stop Service (OSS) of Bangladesh Investment Development Authority (BIDA) needs to be implemented without delay to improve the country's ranking.
Coordination among BIDA, the Bangladesh Economic Zones Authority (BEZA) and Bangladesh Hi-Tech Park Authority needs to be ensured for an effective OSS, he said.
Mr Taseer also said that to tap the potentials of the 4th industrial revolution (4IR), the academic curriculum across all levels of the education system need to be restructured alongside organising industry-focused skill development programmes.
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