Finance Bill passed with changes

The government imposed a new type of surcharge at 1.0 per cent on import and production stage of mobile-phone handset as the Finance Bill 2014, with a number of changes in the proposed fiscal measures for the upcoming fiscal year (FY), was adopted Saturday by parliament.
Finance Minister AMA Muhith told the House that the proceeds from surcharge would be spent on development of information and communication technology (ICT).
Customs duty (CD) on import of mobile handset has been halved to 5.0 per cent from the existing 10 per cent. The finance minister also waived 5.0 percent advance income tax (AIT) on the import of mobile handset. However, 15 percent value-added tax (VAT) on the handset import will remain unchanged.
The finance minister withdrew few tax proposals, including capital-gain tax for individual investors in stocks, in the finance bill before its adoption by a roar of ayes by the treasury-bench members and their former coalition allies in the opposition rank.
The government did away with the opportunity that had allowed declaring undisclosed income through investment in treasury bonds by paying 10 percent tax, as there had been little response to the offer.        
However, the two other black money-whitening conduits have been retained.
Disclosure of undeclared income through purchase of flats and apartments and also through 'voluntary disclosure' remained unchanged for the upcoming FY.
The finance minister earlier in his post-budget press conference had categorically said  the money-whitening facility would not be there this time.     
The finance minister also made few amendments to the tax measures. "I am considering these in the light of suggestions made by the prime minister," he told the House.         
He lowered tax on transfer of any structures, flats and apartments by re-fixing it at Tk 600 per square-metre instead of proposed Tk 90 per square-foot.
Tax-collection procedure on capital gains of the companies from the stock market has also been changed. Companies will have to pay gain tax at 10 percent rate at source, instead of existing system--at the time of submission of tax returns at the year-end.
From FY 2014-15, shareholders will have to pay 15 percent tax at source on dividend income, instead of existing 10 per cent, in case of not having taxpayer's identification number (TIN).
The finance minister rolled back his proposal on mandatory submission of audited accounts statement for individual taxpayers having annual income above Tk 50 million derived from business or profession.
Proposed few provisions as to allowing cost-management accountants for auditing accounts statements have also been withdrawn. Only Chartered Accountants would have the authority to do the job.
Tax-holiday facility on establishment of the new industries would not be applicable for the city corporation areas, the finance minister said.
Rice-bran oil and Cineplex investors would enjoy tax breaks for ten years instead of proposed seven years, on condition of starting up commercial production by June 2019.
For salaried taxpayers, the finance minister lowered the existing 7.5 percent presumptive tax, by 2.5 per cent, on use of private cars given by the company.
On customs wing, some 14 imported products would be excluded from the list of 770 products that would enjoy a cut of supplementary duty (SD) in the FY 2014-15.
Rate of SD would remain same in the upcoming FY on import of cosmetics, soap, detergent, leaf spring, glucose, razor, blade etc.
Importers of liquefied petroleum gas (LPG) cylinders will have to pay 10 percent customs duty (CD) instead of the existing 5.0 per cent. In the budget speech, the finance minister proposed 25 percent CD for the product.
A set of textiles raw materials--- pet chips, artificial staple fiber, artificial tow ---would enjoy duty-free facility in the upcoming FY. The duty was now 5.0 per cent.
Import of jute pin and jute stave would be costlier as the finance minister proposed to impose 10 percent CD against existing 2.0 per cent.
Importers of Phenolic resins, a raw material of ink manufacturers, would enjoy 5.0 percent CD on condition of having local manufacturing plants, against proposed 10 per cent.
A raw material of billet, graphite electrode, would enjoy 10 percent CD on import against the existing 25 per cent.
A number of medicines would enjoy exemption from payment of VAT at trading stage. Lifesaving medicines like kidney-dialysis solutions, anti-cancer drugs, vaccine for humans, veterinary vaccine, insulin and its Pen Curtis etc, homeopathic, ayurvedic, unani and herbal medicines would enjoy the tax waiver.
Handmade biscuits and cakes priced up to Tk 100 would continue to enjoy VAT exemption.
Vat on travel agencies has been halved to 7.5 per cent from the existing 15 per cent. Some MS products, including rod, would also continue to enjoy the existing tariff value in the FY 2014-15.