June 21, 2024, 6:14 pm

FT Online

2019-07-01 00:15:48 BdST

Finance Bill passed

The Finance Bill 2019 was passed unanimously in Parliament today with some changes in the capital market, VAT and handloom (taant) industry.

Prime Minister Sheikh Hasina for the first time in the history of the country moved the Bill on request from Finance Minister AHM Mustafa Kamal.

The Finance Minister made the request as he was unable to move the Bill due to his sickness.
Taking part in the general discussion of the proposed budget, Prime Minister Sheikh Hasina said the government has fixed 2030 for achieving the sustainable development goals (SDGs) while 2041 to make the country a developed one.

“For this and also to implement our election manifesto, this pro-people, pro development and balanced budget will act as an effective tool,” she said.

Sheikh Hasina said that for a prosperous economy, it is needed to have a prosperous capital market. “This budget has many incentives for the capital market and the implementation of these incentives will expand the market and help play its desired role,” she said.

Sheikh Hasina said to protect the interest of the small investors, the budget proposed to impose 15 percent tax on stock dividend distributed to the shareholders by any listed company.

“But, some of the business community raised their objection in this regard. This will raise their cost of capital and financial expenses while they will be discouraged to invest,” she said.

The Prime Minister mentioned that from the banks and financial institutions it was informed that as per the demand of the Bangladesh Bank the listed companies cannot give the cash dividend due to increase of the paid up capital.

In this context, she proposed that listed companies will give same percentage of cash and stock dividend. If the percentage of the stock dividend remains higher than 10 percent, tax will be imposed on the announced stock dividend.
Sheikh Hasina said that in the proposed budget the government enforced 15 percent tax, if any company’s retained earnings and reserve exceed 50 percent of its paid-up capital.

“But the businesses raised their objection saying that accumulated profit usually invested in companies and for its expansion and development, capital is needed for expansion and reform of the local and foreign companies,” she said.

But, Sheikh Hasina said that paying of profit to the investors have to be kept in mind.

The Prime Minister said that listed companies can transfer 70 percent maximum of the after tax net profit for retained earnings and reserve. It has to give rest of 30 percent as stock and cash dividend. If any company fails to do so, then 10 percent tax will be imposed on the transferred retained earnings and reserve.

She proposed that businessmen providing VAT at lower than 15 percent rate will be able to claim rebate which was not proposed in the original proposal that was placed in Parliament on June 13.

In the proposed budget, the government proposes imposition of 5 percent, 7.5 percent and 10 percent VAT on specific goods and services, apart from the standard VAT rate of 15 percent.

In addition, it wants to impose specific tax on some services and products such as key construction material rod and newsprint. It has also suggested continuing the existing 2 percent and 2.4 percent VAT at the trading stage of petroleum and pharmaceuticals. It also said that businesspeople will not be able to avail themselves of input tax credit if they pay less than 15 percent VAT.

To protect the local handloom industry, the Prime Minister proposed to impose Taka 4 as VAT on per kilogram thread which was five percent in the proposed budget.

She also said that the government will bring logical changes in the import duties of papers that do not produce in the country.

The Premier said that everyone will be benefitted by the budget adding, “this budget will help us to go forward with continuing the pace of ongoing development to build a happy, develop and a prosperous country,”

Sheikh Hasina also said that the government has achieved the quality of upgrading Bangladesh into a middle-income country by successfully implementing the ‘Vision 2021′ and it is heading forward to achieve the Sustainable Development Goals (SDGs) by 2030 and thus build a developed country by 2041.

Finance Minister AHM Mustafa Kamal in his winding up speech said, “We’ll definitely reach at double digit GDP growth by 2024 and will attain 10 percent growth every subsequent year.”

“We all under the leadership of Prime Minister Sheikh Hasina have relentlessly been working hard and reached the country to a position where from no nation will be able to derail our development trend.”

He said that Bangladesh will reach to a position by 2030 that it’ll not take foreign debt anymore after 2030 rather provide debt to others.

At the outset of his speech, Kamal said he was caught by dengue fever on June 10 and described his illness and situation faced during the placement of the proposed budget on July 13.

Opposition bench members Fakhrul Imam, Pir Fazlur Rahman, Kazi Firoze Rashid, Begum Rawshan Ara Mannan, M Rustam Ali Farazi, Mokabbir Khan, Rumin Farhana proposed publishing the bill for eliciting public opinions.

In response, Prime Minister Sheikh Hasina hinted that BNP has deposited money in Swiss Bank which the party collected through nomination business in the December 30, 2018 national election.

“We have information that BNP gave nomination to 692 candidates in 300 seats in the 2018 election. More than three or two candidates were given nomination against each constituency. Where did they deposit that money got from nomination business? You will get the idea of statistics of Swiss Bank account if you look into the matter,” she said.

Pointing to the lawmakers’ criticize over the government’s failure to control loan default culture, Sheikh Hasina said it was the military dictator Ziaur Rahman who grabbed the state power and introduced military rule in the country, started the loan default culture.

The prime minister said the loan default culture could have been stopped had the democratic government remained in power. “We have already taken some measures and also taking measures at present to stop loan default,” she added.

On the budget proposal of giving scope to whitening black money, Sheikh Hasina said her government will certainly take measures if corruption increases through giving this scope.

The Prime Minister moved the bill which was passed by voice vote.

The bill was introduced in the House on June 13.

The House accepted some amendments of the Finance Bill, 2019 brought by M Shahiduzzaman Sarkar, Mujibul Huq, Pir Fazlur Rahman, Moshiur Rahman Ranga, Shahiduzzaman Sarkar, Abdus Shahid, Israfil Alam, Kazi Firoze Rashid, Harunur Rashid, M Rustam Ali farazi, and Begum Rawshan Ara Mannan. These amendments were mainly done for clerical errors.

Later, the proposals for publishing the bill for eliciting public opinions and amendments were rejected by voice vote.

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