Increased export earnings, remittance, FDI needed to increase forex reserve: Speakers

Speakers at a seminar on Sunday stressed on boosting revenue collection by expanding the tax net which will enable the government to borrow less from the market as foreign borrowing increases vulnerability to external conditions and potential currency depreciation.

To increase reserves, they also said increased export earnings, remittance and FDI are important to stabilize the exchange rate side by side with austerity in expenditure, increasing revenue collection and promoting fiscal reforms is a must to maintain fiscal discipline, reports BSS.

The speakers said this at a seminar on "Salient Features of Finance Act 2024: Investment Perspective" organized by the Institute of Chartered Accountants of Bangladesh (ICAB) at its auditorium today, said a press release.

AKM Badiul Alam, Member (Tax Policy), National Board of Revenue (NBR) spoke at the seminar as the chief guest. Dr. Nasiruddin Ahmed, Former Chairman of NBR, Dr. Ahsan H. Mansur, Executive Director of the Policy Research Institute (PRI) of Bangladesh, and Md. Farid Uddin, Ex-Member of Customs and VAT, NBR were the panel speakers and were connected through online Zoom with the seminar.

Snehasish Barua, Partner, Snehasish Mahmud & Co., Chartered Accountants presented the keynote paper while ICAB President Mohammed Forkan Uddin delivered the address of welcome.

Mohammed Humayun Kabir, Chairman, TCLC, Council Member & Former President-ICAB moderated the session while Md. Johirul Islam, Vice President (Technical & Regulatory Affairs), ICAB gave the closing remarks.

In the seminar, the keynote presenter provided an overview of the changes brought in the Finance Act 2024 and the SROs issued thereafter.

With the detailed examples of impacts on businesses by the changes provisions of the Finance Bill 2024, the paper presenter Snehasish Barua aims to provide accurate and updated facts and figures citing from the Bill.

About inflationary pressure, he said the increased money supply and demand can push prices up. "However, demand for consumption must be contained and price must be monitored to keep the current trend of inflation stable," he added.

The speakers at the seminar also said the government's borrowing may raise interest rates, deter private investment, which needs to be addressed prudently.

They said the provision in the Finance Bill stating all receipts and income must be transacted through bank transfer for every single transaction above Taka 5 lakh and annual transaction over Taka 36 lakhs of expense and investment would bring a positive impact on the economy.

They said, under the new Finance Bill TDS on payment to non-residents shall not be applicable for the cases like payment made to any authority of the foreign country, payment for subscription fee of professional body, expenses of liaison office, international product development & marketing expense, tuition fees, and any type of security deposit.

Therefore, it will reduce hassle in making outward remittance and reduce tax burden as well. They also suggested for widening further the tax net by introducing a new withholding entity.

The speakers also said that the government employees and individuals having total assets more than Taka 50 lakh need to submit assets and liabilities statements which will enhance transparency and accountability within the public sector and give some relief for the individual taxpayers other than the government employees.

They also mentioned that mandatory PSR submission for obtaining and renewing licenses of hotels, restaurants, motels, hospitals, clinics and diagnostic centers located within the city corporation areas will widen further the tax net.