The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), the country's apex trade body, has termed the proposed budget investment and business friendly.
"The budget envisages fulfillment of basic demands of the businessmen, which will facilitate investment and business," the FBCCI president Annisul Huq told the newsmen at a post-budget press conference in the federation building Thursday.
Earlier on the day, the FBCCI leaders met with finance adviser Dr. Mirza Azizul Islam and placed some additional fiscal demands.
The finance adviser, who unveiled nearly Tk 1.0 trillion national budget for the next fiscal 2008-09 on June 9, assured the trade body of considering its demands.
He said: "Their demands will be considered taking the impact on revenue in mind."
Emerging from the meeting, Mr. Annisul Huq said: "We made the demands as the proposed offers on undisclosed income will not encourage businessmen to take the opportunity," said FBCCI president Aanisul Haq.
The FBCCI wants a package system like 'green channel investment' through which they will be allowed to invest undisclosed money in productive sector without paying any penalty.
The FBCCI chief also urged for further change in duty structure saying the proposed one is not export friendly.
"The 7.0 per cent duty slab proposed for imported raw materials and intermediate goods should be lowered to 5.0 per cent," he said.
He also said abolishment of indemnity bond to import capital machinery by the export oriented industry is not a good step to encourage exporters.
However, at the press conference the FBCCI chief said the businessmen have seen a sincere effort of the government in preparation of the business-friendly budget.
Under the leadership of the FBCCI, the businessmen had the opportunity to interact with the government high-ups several times before the preparation of the budget, which he said, has been reflected in the fiscal proposals, Mr Annisul Huq said.
He, however, said: "Mere investment and business friendly budget" will not be enough to ensure pro-business environment unless there remains a political stability.
"Budget is one of the major instruments to spur growth of the national economy, but if the political instability prevails the economy is sure to decline," Mr Annisul Huq clarified.
The FBCCI president identified reduction of taxes on raw materials and capital machinery imports, extension of tax holiday period for the deserving industries and expansion of value added taxes (VAT) in the budget are among the major issues the businessmen have been demanding for long for the betterment of their businesses.
He, however, said the demand for allowing the flow of legal undisclosed income into businesses has not been met in the proposed budget.
Businessmen had urged the government not to ask sources if the undisclosed income attained through legal means is invested in the manufacturing sector, Mr Huq said.
The government has concentrated more on social safety net and taken measures to face food crisis and reduce poverty, the FBCCI president said.
He, however, expressed concern over overall deficit of Tk 305.80 billion in the proposed budget which, he said, might have a negative impact on the overall economy if not properly handled.
The banking sector might face a liquidity crisis and private sector investments might face a setback as the government has targeted to realise a sizeable amount of Tk 13,4.98 billion through bank borrowing, the FBCCI president opined.
The proposals like opening of small and medium enterprise (SME) help line centre in each district, reduction of taxes on electronic cash registers, special tax measures for agro-farms, zero tariff on poultry feed items, reduced tax on irrigation pumps, diesel engines and tractors, fixing of agri-loan target at Tk 90 billion and zero tariff on import of fertiliser and seeds would bring about a positive changes for national economy and help meeting mounting food demand, the FBCCI observed.
The government's revenue income in the current fiscal was satisfactory because of positive response of the business community, who "acted well under pressure," said Mr Annisul Huq.
The revenue earnings face a downtrend in the coming fiscal as such initiative and pressure might not be there, he said.
The FBCCI also wished government success in implementing the budget and assured to extend all out efforts from the private sector, if necessary.
FBCCI directors, executive members and leaders of different trade bodies and chamber houses were present at the press conference.
