The government has taken an initiative to formulate a new Income Tax law scrapping the decade-old Income Tax Ordinance, 1984 and excluding the scope to bring any changes to income tax-related matters through Statutory Regulatory Order (SRO), reports UNB.
According to the National Board of Revenue (NBR), currently the government can bring changes to any tax-related matters through SRO. In the proposed law, this scope would be omitted totally.
"However, such a scope can be used during emergency period or national disasters," a senior NBR official told the news agency.
Imposition of new tax must be passed by parliament as per the proposed law, he said, adding that the proposed income tax law would be drafted in Bangla in line with a previous directive of the High Court.
The new law will have tax exemption scopes, but it would not be used indiscriminately. "This will be done considering emergency situation or to facilitate investment in the country," the NBR official said.
There will be no major changes in income tax return, but the law will pave the way for online submission of the return.
The NBR official said that the new law will be simple, pro-taxpayers, investment-friendly and hassle-free.
"We want to create an easy atmosphere for the taxpayers of the country where they will feel encouraged to pay taxes. We are moving towards that direction and soon this will be visible," the NBR official said.
The government is in a move to improve the tax-GDP ratio to 15.3 by 2019 from its currently poor level of 10 percent.
Currently, the number of taxpayers in the country is 29,28,093. These taxpayers provide 37 percent of the total revenue. The government is in a move to increase this ratio to 50 percent by 2020-21.
According to an official document, the number of income tax return in 2016-17 has increased by four lakh, compared to the previous fiscal (2015-16).
The proposed law, 'Income Tax Law, 2017', was placed before the cabinet on August 22 for approval, but the cabinet returned it for further scrutiny and amendment.
The income tax system of the country is running under an ordinance of 1984 with some amendments.
The move to update the country's income tax law started back in 2010-11, when the direct tax law was first drafted with support from the International Finance Corporation.
The NBR posted the draft on its website for opinion from stakeholders, but the feedback was not positive.
The NBR revised the draft to 'Direct Tax Code 2013'. Even after the revision, the draft received negative feedback from many quarters, including the IMF mentioning that that it was far from the international best practices.
At a consultation meeting in February last year, a number of businessmen and former tax officials recommended taking local contexts and needs into consideration while formulating the law.
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