Income tax

The FBCCI requests the early withdrawal of income tax

The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) has called on the government to abolish the withholding tax on income (AIT).

The country’s top trade body made the call in an immediate response to the draft national budget for the financial year 2022-23 on Thursday.

“Overall, the proposed budget is development and welfare oriented. However, if implemented effectively, the budget gap can be easily bridged,” said FBCCI Chairman Md Jashim Uddin.

“We have claims, we will defend them in detail next Saturday. The withholding tax has been increased from 0.5% to 1%. We demand its reduction,” he added.

He said most of the country’s backhaul industries are small and medium-sized. If the withholding tax on income is not withdrawn, companies will not be able to survive.

The proposed budget has a deficit of Tk2,45,064 crore. In this regard, said Jashim Uddin, the government should be careful when taking out loans to cover the deficit.

“If the government borrows more from the banking system, then the pressure on banks’ liquidity increases. This could lead to insufficient capacity of banks to lend to entrepreneurs, which would reduce investment. Considering all aspects, our advice to government must borrow from foreign sources,” he added.