CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Bangladeshi Think Tank Opposes Corporate Tax Cut

Bangladeshi Think Tank Opposes Corporate Tax Cut

by Mary Swire, Tax-News.com, Hong Kong

07 May 2014


The Centre for Policy Dialogue (CPD) has recommended that the Government ignore calls for a cut in the corporate tax rate in Bangladesh, in its annual 2014/15 pre-Budget submission.

To boost economic growth and foreign direct investment, it has been suggested by the business sector that the country's corporate tax rate should be reduced from its current level of 27.5 percent for listed companies and 37.5 percent for non-publicly traded companies. However, the CPD pointed out that "the logic of lowering the corporate tax rate, on the grounds that it is very high compared to other competing countries of Asia, is not correct."

It said: "The average corporate tax rate of Bangladesh is one of the lowest in South Asia which is close to the average corporate tax rate of South East Asian countries, and the argument that a lowering of the corporate tax rate will have a positive impact on private investment is not robust," the CPD said.

It commented that, with the current dependence on debt-based financing for investment by the corporate sector, a cut in the corporate tax rate may not yield a greater amount of investment. The think tank said the Government should instead create a more favorable environment for businesses and tackle non -compliance.

The CPD recommended that the Government should revisit and rationalize the tax incentive structure, while also tackling abusive transfer pricing arrangements, and tackle evasion due to re-invoicing and incorrect declarations. It called for the creation of a specialized taskforce in the National Board of Revenue to deal with these issues.

Last, the CPD proposed an upward revision to the exemption limit for personal income tax, from BDT220,000 (USD2,830) to BDT300,000, with concomitant adjustments to other thresholds. An increase in the tax exemption for the house rent of individual taxpayers (from BDT20,000 to BDT30,000) could also be considered, it recommended

TAGS: compliance | tax | business | tax compliance | tax incentives | fiscal policy | budget | corporation tax | tax thresholds | transfer pricing | tax rates | Bangladesh | individual income tax

To see today's news, click here.

 
















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »