FICCI lauds budget, terms it 'pragmatic'

FE REPORT | Published: June 10, 2022 01:33:30

The Foreign Investors' Chamber of Commerce and Industry (FICCI) on Thursday appreciated the finance minister for presenting a 'pragmatic budget' in this difficult circumstance.
"We are very happy to observe that some of the FICCI's recommendations were considered in the current budget, which will definitely have some positive impact on the businesses as well as attract FDI," the chamber said in its instant reaction on the proposed budget for FY 2022-23.
It said the GDP growth target that has been set at 7.5 per cent is achievable provided that the GDP-investment ratio, among other measures, increases to the expected level.
The chamber also appreciated notable allocation for the health and education sectors.
It, however, expressed concerns over the reduced allocation for the key mega projects, which would result in a slow implementation as well as raise the total cost of the project.
"We feel instead of reducing the allocation in mega-project, the government could concentrate on enhancing the quality of spending, which could bring further efficiency as well as generate employment."
It also expressed concern over bridging the deficit from banking sources which may tighten the liquidity situation, it said.
The chamber hailed, among others, reduction of corporate tax rate for certain listed and non-listed companies by 2.5 per cent subject to certain conditions.
It also welcomed the proposal that tax deduction at source for raw material suppliers would be reduced to 4.0 per cent from 7.0 per cent.
"The limit for perquisite has been increased from Tk 0.55 million to Tk 1.0 million, which is welcoming although this is double taxation," it said.
It also appreciated the amendment to the definition of amalgamation and clarification in the tax implications of (a) capital gain arising from amalgamation, (b) carry forward of accumulated loss, and (c) unabsorbed depreciation will position our law at the international level which is long cherished demand of business fraternity.
Apart from the hailing a number of proposals, the FICCI expressed the fear that some concerns, if not addressed, would have an adverse impact on the business and investment.
Among them, it said that an entity is required to pay WPPF (Workers Profit Participation Fund) as per the provision of labour law.
It is not a dividend rather an expense, a portion of which is also payable to the government, it said, adding that it is an expense not at the discretion of the company but a compulsion.