Budget 2023-24 reaction: AmCham focuses on crisis management
The American Chamber of Commerce in Bangladesh (AmCham) in an instant reaction to the proposed budget on Thursday recommended focusing on a “crisis management contingency approach” in the wake of the global crisis.
Since the government of Bangladesh aims to attain a 7.5% growth rate in FY2023-24 containing the inflation during these difficult times heading for a new government to take over believing in “across the long journey of development, towards Smart Bangladesh,”, AmCham proposed the following recommendations.
No significant economic growth is conceivable without a sustained Foreign Exchange reserve growth. Hence, instead of a gross import ban, we should speed up the foreign-funde projects’ implementation and reconsider own funded projects having a sizeable import component ensuring safeguard against economic shocks caused by volatile energy inputs and help finance balance of payments deficits, Syed Ershad Ahmed president of American Chamber of Commerce in Bangladesh (AmCham) said in a press release.
Alternatives to increase export revenue: Instead of traditional heavily RMG dependent export basket, policy support should be extended towards business/industry for effective implementation of existing policy, create a user-friendly process and further allocation of national funds to enhance this potential source.
Import Duty and minimum tax: Considering the advance tax as the minimum tax paid by an industrial undertaking at import stage on raw materials in certain industries and the fixed (5%) minimum tax on the gross receipt would be detrimental for the existing investors, hence request to revisit this proposal for the best outcomes for businesses and consumers alike.
Renewable energy to offload existing supply chain: Investing in renewable energy not only benefits us environmentally but also contributes to economic growth through job creation, market expansion in related industries supporting clean-energy technologies. We recommend favorable immediate initiatives.
Income Tax policy diversity: Diverse policies in individual tax rates, exemptions, deductions, and credits affect different taxpayers based on their income levels, types of income sources, and other individual circumstances. We strongly recommend the National Board of Revenue (NBR) to adopt automation in all possible levels at the same time to focus more on expanding the Tax net. We suggest introducing the e-payment and e-TDS system and Digital Payments incentives to ensure accountability and transparency throughout the process.
Reducing per capita liability: It is a critical issue for developing countries that rely on external borrowing to drive economic growth . We recommend adoption of prudent debt management strategies that promote transparency, accountability and fiscal discipline.
Focused project on Climate vulnerability: All projects going anti-environment and against the notion of green economy should be abandoned. We strongly recommend creating budgetary allocation for such projects on climate vulnerability since Bangladesh is already experiencing erratic weather patterns.
It also appreciated and showed sincere gratitude for developing new and improved Logistics infrastructure with the support of Logistics Infrastructure Development Working Committee (LIDWC) from the Prime Minister’s Office.
By prioritizing the right budgetary allocations in infrastructure, education, technology, energy, and social inclusion, we can build a sustainable, better future for all.
AmCham believed budget execution is what matters in the end and should be measured for quantity and quality.
Earlier in the day, Finance Minister AHM Mustafa Kamal placed the proposed national budget for FY2023-24 in Parliament with a deficit of Tk 2,61,785 crore with a focus on making a Smart Bangladesh and annual growth target of 7.5 percent.