ICMAB Press Conference on National Budget 2021-2022

A Press Conference on “National Budget 2021-2022” organized by the Institute of Cost and Management Accountants of Bangladesh (ICMAB) was held in ICMAB Ruhul Quddus Auditorium, Nilkhet, Dhaka on Sunday evening, June 06, 2021.

The programme was moderated by the Vice-President of ICMAB, Mr. Md. Mamunur Rashid FCMA, while ICMAB President Mr. Abu Bakar Siddique FCMA presided over the meeting. Vice-President Mr. Md. Munirul Islam FCMA, Secretary Kazi Muhammad Ziauddin FCMA and Treasurer Mr. A.K.M. Kamruzzaman FCMA of the Institute were present in the Press Conference and answered the questions raised by the floor. A well-organized Paper on the National Budget 2021-2022 was presented by Fellow Member of ICMAB Mr. Md. Shafiqul Alam FCMA.

The salient points of the reactions of ICMAB to the proposed budget are as follows:

Honourable Finance Minister AHM Mustafa Kamal giving emphasis on health sector to combat the pandemic, protect the poor and businesses and speed up economic recovery set the theme “Bangladesh Towards a Resilient Future Protecting Lives and Livelihood” and placed before the Parliament budget of 6lac 3 thousand 681 crore. This is the 13^thconsecutive National Budget declaration by the incumbent Government.

During the prolongation of Covid-19 neither there will be significant investment nor employment generation. Therefore, to revive the Economy in the post pandemic era 80% of the total population have to be under vaccinated at any cost. To eliminate the Corona Virus should be the topmost priority. In this Corona Virus Pandemic for general leave, lockdown different organizations and businesses have to keep closed, as a result a huge population has gone under poverty line and budget allocation in Social Security Sector is very low; so more allocation in this sector should be given preference.

ICMAB thinks that in the present VAT Law and Income Tax Law there are some inconsistences. This should be alleviated. Some justifications need to be done for advance Tax.

In the proposed budget 2021-22, one-person company tax rate was reduced to 25% which is quite logical, thinks ICMAB.

In the proposed budget 2021-22, tax rate for listed companies in the share market reduced to 22.5% from 25% and unlisted companies’ tax rate reduced to 30% from 32.5%which is quite praiseworthy but in the new proposal source tax increased from 5% to 7% on the delivery side, which will ICMAB thinks ultimately increase the tax rate from the previous year. For business-friendly tax implementation, justification is very much required on this side.

Presently Tax rate (MFS) has been increased in the sector of Mobile Financing. Share market enlisted companies tax rate has been increased from 32.5% to 37.5% and unlisted companies Tax rate has been increased from 37.5% to 40%. Till now no company has been enlisted in the share market so all the MFS companies have to submit 40% tax. The majority of the customers of MFS companies are low-income people. So, this tax burden will be a bar to the financial inclusion of the lower income people which will negatively impact the overall digitization. Therefore, ICMAB thinks that in this Prolonged Pandemic situation to attract the people at MFS services the proposal of increase of tax in this sector should be withdrawn, so that a cashless society is established.

In the proposed budget tax rebate has been proposed for E-learning, Cloud Service, System Integrations, Mobile Application Development Services, E-Book Publications, IT Freelancing Distributors and these companies will get the Tax rebate up to 2024. As a result, digital services will be easy and cheap and easily reach to all class of people including the poor. So ICMAB thinks that the dream of establishing Digital Bangladesh will come true.

Proposals have been made that in order to establish Made in Bangladesh Brand Auto mobile three-wheeler and four-wheeler production companies will get rebate for10-20 years under certain conditions. Besides some home appliances and kitchen appliances products and light engineering industry products producing companies will get 10 years rebate under certain conditions in the proposed budget. As a result, home grown and import substitution industry will be growing accelerated.

ICMAB also welcomes the announcement to make the health services available at outside cities and the establishment of 250-bed general hospitals and 200-bed specialized hospitals in those areas will get 10 years tax rebate under certain conditions.

Besides ICMAB thinks that, if Cost of Goods Sold statement is audited by the Cost and Management Accountants then cost efficiency will be increased and expenses will be reduced. As a result, it will bring significant impact on the overall economy of Bangladesh.